Oil, Politics, and Power: The Essequibo Dispute
Timothee Gros | 4 March 2025
SurinameCentral/Wikimedia, CC BY 4.0
Summary
Essequibo has been the heart of a territorial dispute between Venezuela and Guyana for over a century. Oil discoveries made by Exxon Mobile in 2015 have only drawn more strategic focus.
Amid Venezuelan President Nicolás Maduro’s reelection, the Essequibo dispute could be instrumentalised to gather more support and distract the populace from domestic issues.
Although military confrontation remains highly unlikely, Maduro has various options at his disposal to strengthen his claim over the region in the long term.
In the wake of Venezuelan president Nicolás Maduro’s reelection, eyes have turned to Essequibo, an area of around 160,000 km2 located within the sovereign borders of Guyana. The 1899 Paris Arbitral Award settled a dispute between Venezuela and the United Kingdom, with the latter obtaining full sovereignty over Essequibo and later becoming an uncontested part of Guyana when it gained independence. However, important oil deposits discovered by Exxon Mobile in 2015 have pushed Venezuela to negate the validity of these agreements, claiming instead that Essequibo belongs to them.
Although the Argyle Agreement signed in 2023 prevents Venezuela and Guyana from using violence to resolve this dispute, Maduro has already implemented various manoeuvres to shake the political apparatus and increase his influence on the area.
Last year, state-owned oil companies were instructed to explore opportunities in the disputed area, whilst Venezuelan lawmakers approved the creation of a new state, ‘Guayana Esequiba’, which would be governed by a Venezuelan official. Furthermore, in February 2024, satellite imagery revealed intensified efforts at building military capabilities along the border. Guyana retaliated by threatening to invoke the United Nations (UN) should any breach occur.
These initiatives suggest a willingness to strengthen Venezuela’s claim over the area through soft power and military means. Ultimately, should a negotiated settlement decide the outcome, Venezuela aims to have stronger arguments. More so, the crisis will likely be instrumentalised as part of Maduro’s propaganda campaign, diverting attention away from domestic issues such as unemployment and international sanctions.
Overall, the threat of military conflict between Venezuela and Guyana remains highly unlikely, especially with the United States (US) acting as a powerful deterrent. However, this dispute can still escalate, as Venezuela can count on powerful allies in Russia, China and Iran to sustain a genuine challenge, both locally and through international leverage. Maduro may take advantage of the dispersed international attention to gradually annex Essequibo, a move reportedly endorsed by Venezuelan voters in December 2023.
Forecast
Short-term
Maduro will likely use the Essequibo dispute as propaganda to ignite nationalistic support. Various tactics to increase Venezuelan soft power in the region will also likely be implemented, such as extraction projects on local resources, providing Venezuelan citizenship to inhabitants of Essequibo, and spreading nationalist narratives in schools.
Long-term
Military confrontation remains extremely unlikely, especially as most of the international community, including the US, opposes Venezuela’s claims. However, continued military reinforcement at the border, alongside potential partnerships with the likes of China, Russia or Iran, could force international actors to invest in conflict resolution measures.