Courtesy Reuters

The Venezuelan Oil Crisis

In June 2004, the price of oil reached $42.33 a barrel-the highest point ever in 21 years of trading on the New York Mercantile Exchange-pushing average U.S. gasoline prices to more than $2 per gallon. The surge had numerous causes, including market speculation, shortfalls in the U.S. capacity for refining crude oil, higher Chinese demand, and insecurity in the Middle East. The root of the crisis, however, lay closer to home: in Venezuela, where a general strike in late 2002 and early 2003 had severely constricted the flow of oil and gasoline for several months. For the first time, the U.S. oil supply was …

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