The Red Queen’s Dilemma

In Lewis Carroll’s Through the Looking-Glass, the Red Queen tells Alice that “it takes all the running you can do, to keep in the same place.” Nearly 150 years later, this paradox has become the defining reality of American energy independence—and the reason why Venezuela, despite a decade of collapse, suddenly matters more than ever to Washington.

The numbers tell a story that few outside the industry fully grasp. In 2024, the United States produced approximately 13.2 million barrels of oil per day, shattering all previous records and cementing America’s position as the world’s largest oil producer. Yet beneath this triumph lies a precarious truth: roughly 4.5 million barrels of that daily production—more than one-third of the total—comes from wells drilled in the previous twelve months. This isn’t growth. This is a treadmill accelerating toward exhaustion.
EIA source​

Meanwhile, Venezuela sits atop 303 billion barrels of proven oil reserves, representing 18.5 percent of the world’s economically recoverable petroleum—more than Saudi Arabia, more than Iraq, more than anyone. Its production has collapsed from 3.2 million barrels per day in 2000 to barely 730,000 barrels per day today, a staggering 77 percent decline that represents one of the most spectacular industrial failures in modern history. Yet this dysfunction, paradoxically, may be precisely what makes Venezuela indispensable to America’s energy future.​

The Accidental Revolution

To understand why these two stories intersect, we must return to a hot day in North Texas in 1997, when a petroleum engineer named Nick Steinsberger made a mistake that would change the world.

George Mitchell had been hammering away at the Barnett Shale for sixteen years, convinced that vast quantities of natural gas lay trapped in the dense rock formations beneath Fort Worth. His company, Mitchell Energy, had drilled hundreds of wells, experimenting with different techniques to fracture the shale and release its contents. By 1997, they had refined their approach to using thick, gel-based fluids mixed with sand—”proppants” that would hold open the microscopic fractures created by pumping fluids at extreme pressure deep underground.​

But on that particular day, something went wrong. The gel didn’t mix properly with the other chemicals. Instead of the viscous, Jell-O-like substance that engineers expected, the mixture remained stubbornly watery. Steinsberger watched, concerned, as contractors pumped this thin fluid—mostly water with some friction-reducing polymers—into the well. By all conventional wisdom, this “slickwater” frack should have failed.​

It didn’t. In fact, the well produced a surprising amount of gas.​

Steinsberger’s curiosity was piqued. After learning that another company, Union Pacific Resources, had been using similar slickwater fracking techniques in sandstone formations, he convinced Mitchell to let him experiment further. Through late 1997, he tested his water-based mixture on several wells, tweaking the horsepower of the pumps, adjusting when sand was added to the fluid. Most of his colleagues dismissed the results. Rivals at other companies scoffed.​

Then, in early 1998, Steinsberger noticed something remarkable: the wells he’d treated with slickwater weren’t declining as rapidly as expected. They kept producing. The breakthrough was real, though it would take years for the industry to recognize it.​