How Trump’s Push on Venezuela, Cuba and Greenland Could Reshape Everyday American Finances
Written by
Travis Woods
Edited by
Jenna Klaverweiden
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The year has had a chaotic start in the Western Hemisphere. On Jan. 3, President Donald Trump launched Operation Absolute Resolve, a U.S. military incursion into the oil-rich country of Venezuela, which climaxed with the capture of Venezuelan leader Nicolás Maduro on charges of narco-terrorism and drug trafficking.
President Trump then followed that operation with intimations of an American annexation of Greenland from Denmark, as well as threats to Cuba. Not only could this unprecedented international aggression create geopolitical consequences, but it could affect the finances of everyday Americans as well. Here are a few possible scenarios.
Venezuela and Gas Prices
Venezuela is home to some of the largest oil reserves in the world, and America’s recent intervention — including seizing Venezuelan oil tankers, per Time — has already restricted crude oil in the global markets.
Such actions could place upward pressure upon oil prices across the world, as the various markets might factor in this instability and supply uncertainty. The potential ripple effect of higher global oil prices? That can result in higher gas prices at the pump for you, as well as higher energy bills.
However, a lot is uncertain with the situation in Venezuela and its effect on prices. “Given the abruptness of the political transition in Venezuela, and the country’s long history of underinvestment in its energy infrastructure, I expect any material changes in Venezuela’s oil exports will take an extended amount of time before they can affect global oil supply, and thus affect oil prices,” Kristen Dougherty, manager of the Fidelity Select Energy Portfolio, said in a recent article from Fidelity. “And I still think oil prices are likely to remain range-bound in 2026, as phased output increases from the Organization of the Petroleum Exporting Companies (OPEC) are gradually absorbed by steady global demand.”
Cuba
Cuba is a major ally to Venezuela as well as a significant trading partner. The country has also had a contentious-at-best relationship with America. Moreover, U.S. Secretary of State Marco Rubio has warned that Cuba is “in a lot of trouble,” according to the Associated Press, as “it was Cubans that guarded Maduro” during his capture.
President Trump added that the Cuban economy (already weak because of a decades-long U.S. embargo) will continue to collapse now that the ostensibly U.S.-controlled Venezuela will not be supplying it with oil.
Whatever ecnomic impact is felt by Cuba, though, isn’t likely to extend to America because of the long-standing embargo between the two nations.
Greenland and Energy Costs, Economic Fallout
The self-governing Greenland, which falls under the auspices of the Kingdom of Denmark, has attracted President Trump’s ire for months, with the president recently stating, “Greenland is covered with Russian and Chinese ships all over the place. We need Greenland from the standpoint of national security.” Trump has refused to rule out using the American military to take jurisdiction of Greenland (and surrounding waters) by force, and his public musing on the subject has increased since the events in Venezuela.
The impact of an annexation of Greenland upon everyday American finances is difficult to predict and articulate. The level of geopolitical tension that could erupt from such an event could send stock markets tumbling in shock. The disruption of oil and gas supply lines in the Arctic surrounding Greenland could cause a short-term spike in American gas and energy costs. Additionally, while this is on the extreme end of possibility, a U.S. invasion of Greenland could possibly lead to a full-scale war, which could in turn create financial destabilization on a much grander scale.
The bottom line? It’s hard to predict how President Trump’s recent hardline stance on Western Hemisphere security will impact American finances directly, but gas and energy costs could bear the immediate brunt of it.
Editor’s note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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