Why Greenland and Venezuela Are Really about AI
Venezuela appears to be a classic oil story. However, this is not just about fossil fuels in the traditional sense of energy security. AI is changing the energy equation dramatically.
A view of Universal Pictures logo displayed on a digital screen and an artificial intelligence (AI) illustration shown on a mobile phone screen in Ankara, Turkiye on August 20, 2025. Photo by Anadolu Images.
The crisis of the international order is no longer an abstract concept. It is evident in headlines that would have seemed inconceivable a decade ago: US operations in Venezuela, threats to take Greenland by force, and the deepening strategic divide between Washington and its European allies. While the liberal order championed by Washington is not collapsing overnight, it is clearly hardening into a more transactional, unilateral and openly strategic approach.
The Trump administration justifies these moves in terms of national security. This framing is not entirely incorrect, but it is incomplete. The deeper question is not whether these actions are about security. Rather, it is about why they are happening now and how they are converging across seemingly unrelated theatres, from the Arctic to Latin America to Eastern Europe.
The answer lies in the accelerating AI race.
Analysed in isolation, issues such as Greenland, Venezuela, rare earth diplomacy and energy realignment appear as traditional realpolitik: resource grabs, power projection and coercive diplomacy. However, when considered collectively, they reveal a coherent long-term strategy centred on one objective: securing the material and energy resources necessary to win the AI competition against China.
This is not about territory. It is about infrastructure.
AI as a grand strategy
Since returning to office, Trump has treated AI not as a sectoral priority, but as a systemic one. AI is now at the core of US national strategy, shaping defence modernisation, industrial policy, export controls, energy planning and strategic finance. Critical mineral supply chains have been formally recognised as national security imperatives in Trump’s National Security Strategy. Executive orders have sought to expand domestic extraction and rebuild rare earth processing capacity in the United States. Public–private partnerships with American mining and materials firms reflect a broader attempt to restore industrial capabilities that had long migrated abroad.
However, what makes this moment distinct is the unprecedented alignment between the federal government and major technology firms. Silicon Valley is no longer operating at arm’s length from Washington. AI developers, semiconductor manufacturers, hyperscale cloud providers and energy-intensive data centre operators are becoming increasingly involved in strategic planning discussions. Contracts, export controls, infrastructure financing and industrial policy are being designed in consultation with the firms that are driving AI development. The boundary between national and corporate strategy has become unusually thin.
Taken together, these measures signal something larger than economic policy. They reveal an acknowledgement of a structural constraint: the US cannot fully decouple from China under current technological conditions. The conversation about decoupling began during Trump’s first term, but time has exposed its limitations. Semiconductor fabrication, rare earth refining, advanced battery production and energy systems remain deeply interwoven across borders.
This creates a strategic paradox. Although decoupling is presented as a security necessity, the extent of interdependence means that abrupt separation would be destabilizing. Both Washington and Beijing understand this. Each is now engaged in a quiet race to reduce vulnerability before a systemic rupture occurs. The objective is not immediate disengagement, but preparation.
Strategic autonomy in semiconductors, rare earth processing and energy generation will determine who can withstand a future rupture. The state that secures control over these foundational inputs first will possess disproportionate leverage in the AI competition.
Export bans on advanced chip designs, restrictions on critical mineral flows and the rapid expansion of industrial alliances are not isolated measures when viewed through this lens. They are components of a larger repositioning exercise. Resource diplomacy has become more assertive because the AI race has shifted from software to infrastructure.
Greenland: REE and the Arctic chessboard
Trump openly threatened to annex Greenland, claiming it was a matter of national security rather than minerals. The rhetoric was blunt. Yet, after months of diplomatic friction, discussions evolved to include frameworks that explicitly incorporated rare earth elements alongside defence cooperation. This shift reveals a deeper truth: Today, Greenland’s geostrategic value lies less in its immediate military positioning and more in its long-term role in critical supply chains.
The island hosts some of the world’s largest undeveloped rare earth deposits, including the Kvanefjeld and Tanbreez sites, which are both rich in heavy rare earth elements that are essential for advanced magnets, precision weapons, semiconductors and AI hardware. As early as 2019, Washington signed a memorandum of understanding with Greenland focused on cooperation in critical minerals, long before the latest escalation. This suggests that access to resources has long been part of the calculation.
China has also recognised Greenland’s importance. Through its Polar Silk Road strategy, Beijing has pursued infrastructure projects and secured stakes in rare earth ventures linked to Greenland. Even where projects have stalled, China’s dominance in rare earth processing gives it leverage over any future extraction.
Meanwhile, the Arctic itself is undergoing transformation. Melting ice is opening up new shipping routes and altering the military landscape across the North Atlantic. Greenland is located at the intersection of emerging trade routes and missile trajectories, making it a strategically important location in a warming world.
In the evolving geopolitical landscape of AI and advanced manufacturing, rare earths are not peripheral; they are fundamental. The modern infrastructure of AI — semiconductors, permanent magnets, high-end sensors and quantum materials — depends on minerals that are currently dominated by China’s processing capacity. Greenland offers an alternative source of supply in this high-stakes contest.
Therefore, Trump’s interest in Greenland is not a quixotic land grab. It reflects a broader shift: security policy is now infrastructure policy. The question is not whether Greenland matters, but why it matters now, and how access to minerals and supply-chain leverage are reshaping the meaning of national security in the 21(st) century.
Venezuela: Energy, minerals, and strategic leverage
At first glance, Venezuela appears to be a classic oil story. It has the world’s largest proven oil reserves. However, this is not just about fossil fuels in the traditional sense of energy security. AI is changing the energy equation dramatically.
Electricity demand in the United States is rising rapidly, partly due to explosive growth in data centers built to power AI and cloud computing. In 2023, U.S. data centers consumed around 4.4% of total electricity, and this figure is expected to increase significantly as AI workloads grow. In states where data centers are concentrated, electricity prices are rising faster than the national average, with power bills increasing by 13% in Virginia, 16% in Illinois and 12% in Ohio in the past year alone. Utilities are extending generation capacity and upgrading transmission networks to meet this concentrated demand, highlighting that electricity is now a strategic fuel rather than a commodity.
Venezuelan oil and gas could help to offset U.S. energy demand by supplementing crude oil supplies, thereby alleviating stress on the grid and refineries. However, Venezuela’s strategic significance extends well beyond hydrocarbons. Much of the country sits on the ancient Guayana Shield, which is home to substantial deposits of nickel, copper, bauxite, coltan, gold, and other critical minerals that are essential for advanced electronics, defense technologies, renewable energy sources, and AI hardware. In 2016, Caracas established the extensive Orinoco Mining Arc as a state-controlled area for mineral extraction, formally placing these resources under centralized management.
In practice, however, mining there has become a mix of state oversight, informal operations, and widespread illegal extraction. A significant proportion of minerals, particularly coltan and other strategic materials, are smuggled into Colombia and then on to global markets, with much ultimately ending up in China’s processing networks. Even though official rare earth output remains underdeveloped, Venezuela’s broader mineral ecosystem reinforces Beijing’s leverage in global supply chains. At the same time, it should be noted that China has been Venezuela’s largest buyer of crude oil for years.
From this perspective, it could be argued that control or influence over Venezuelan resources and minerals would offer the U.S. several strategic advantages. Firstly, it would allow Washington to act strategically on its own energy needs rather than leaving them vulnerable to global disruptions. Secondly, it would reduce China’s access to discounted Venezuelan crude, thus limiting Beijing’s ability to diversify. Thirdly, it would strengthen U.S. leverage through sanctions and market positioning.
The rare earth diplomacy
The connection between Greenland and Venezuela with AI may not be fully understood without considering some of the policies recently undertaken by the Trump administration. Specifically, rare earth elements have evolved from obscure industrial inputs to the connective tissue of US diplomacy. Under Trump, they are no longer treated as commodities, but as instruments of statecraft.
Washington has rapidly signed or advanced critical minerals frameworks with Australia, Japan, Malaysia, Thailand, Kazakhstan, Argentina and Ukraine. In each case, rare earth elements and processing capacity are explicitly included in the agreements. The U.S.–Australia and U.S.–Japan frameworks aim to integrate upstream mining with downstream processing and supply-chain coordination. Meanwhile, Malaysia’s processing role and Thailand’s manufacturing base are folding Southeast Asia into broader diversification efforts. Kazakhstan and Argentina are positioned as upstream critical mineral partners, particularly with regard to uranium and lithium.
In Ukraine, discussions on reconstruction and strategic cooperation explicitly incorporate critical minerals and energy, linking post-war rebuilding to long-term supply-chain alignment. Even the US–Russian 28-point peace plan, released by the end of 2025, references a long-term economic cooperation agreement with Russia covering energy, resources, infrastructure, AI, data centres and Arctic rare-earth mining.
The same logic applies in multilateral formats. The Minerals Security Partnership (MSP), for example, coordinates resource-rich and industrial economies in order to diversify supply chains and reduce their reliance on Chinese refining. The Quad’s critical minerals initiative brings together the United States, Australia, India and Japan to promote resilience in magnet and battery supply chains.
Pax Silica
Then there is Pax Silica.
Pax Silica is not just a statement of intent regarding AI cooperation; it is an attempt to establish a technological bloc. It brings together semiconductor ecosystems, AI infrastructure, export controls, and supply-chain security within a shared economic security framework. Its signatories span the advanced industrial world, including Australia, Japan, the United Kingdom, Israel, South Korea, the UAE, the EU, Canada and Taiwan. Beneath the rhetoric of AI safety and trusted networks lies a harder reality: a coordinated effort to restructure the global technology supply chain into a bloc that minimizes exposure to Chinese choke points.
Rare earths have clearly become a diplomatic constant. They feature in all of Washington’s negotiations, including trade deals, security compacts, reconstruction funds, discussions on the Arctic, and Indo-Pacific alignments. Trump has effectively turned access to rare earths into a recurring clause of American diplomacy.
Long-term strategy, high stakes
Viewed separately, the moves in Greenland, the pressure around Venezuela and the growing web of critical minerals agreements may appear ad hoc or excessive. However, when considered together, they suggest a more coherent recalibration of American grand strategy. It seems that the United States is reorganizing its external engagements around a single structural concern: securing the material and energy foundations of artificial intelligence before technological decoupling with China worsens further.
Artificial intelligence now influences military modernization, industrial productivity, capital markets and the distribution of geopolitical leverage. In this context, technological dependency is no longer just an economic risk, but a strategic vulnerability. If the AI race determines the future hierarchy of power, then the supply chains that sustain it will have the same importance as naval routes or oil chokepoints once did.
China’s current position did not emerge overnight. For more than three decades, Beijing has systematically invested in the extraction, separation, refining and downstream magnet production of rare earths. It tolerated environmental costs, consolidated industrial capacity, and gradually absorbed the most complex stages of processing into its domestic ecosystem. What began as a policy of resource management evolved into structural leverage. Today, China dominates the refining segment of the rare earth value chain, which remains the true bottleneck of global supply.
A hasty attempt to catch up?
Against this backdrop, Washington’s current strategy appears less like improvisation and more like a hasty attempt to catch up. By incorporating rare earths and critical minerals into agreements with Australia, Japan, Kazakhstan, Argentina, Ukraine and other countries, the United States is trying to rebuild supply-chain resilience within a few years rather than decades. At the same time, it is pushing to rebuild domestic and allied refining capacity while tightening export controls on advanced semiconductor technologies. These steps are not isolated measures; they form part of an effort to reduce exposure before deeper separation becomes reality.
Energy policy is increasingly incorporated into the same calculations. The rapid expansion of AI-driven data centers is reshaping electricity demand in the United States, putting pressure on grids and leading to localized price hikes. Therefore, securing access to external energy resources and reinforcing domestic generation capacity intersect directly with AI competitiveness. The material and energetic dimensions of technological power are converging.
However, none of this guarantees success. Rebuilding refining capacity, navigating environmental and regulatory constraints, and coordinating industrial policy across allied systems will require sustained political commitment. China retains advantages in terms of scale, integration and state-backed financing. However, the pattern of American policy suggests that the objective is long-term structural positioning rather than short-term signaling.
Infrastructural competition
The emerging competition is infrastructural. It concerns extraction, refining, manufacturing on a large scale, and controlling the industrial choke points within the global system of interdependence. When viewed through this lens, Greenland is less about territory than future mineral positioning. Similarly, Venezuela is less about oil politics than about energy leverage and resource denial. Rare earth diplomacy is less about facilitating trade than about restructuring dependency.
Therefore, the central question is not whether these policies appear assertive or controversial. Rather, it is whether the United States can realign critical supply chains quickly enough to avoid structural vulnerability in an era in which artificial intelligence is increasingly determining economic productivity, military capability and geopolitical influence.
However, what makes this moment more consequential is not only the scale of the competition, but also the way in which it is altering diplomatic practice itself. Critical minerals are being incorporated into peace proposals, reconstruction frameworks, security agreements and trade arrangements. Energy flows are being negotiated alongside AI infrastructure. Conversations that once revolved around territorial guarantees or alliance commitments now include rare earth processing capacity. The language of diplomacy is shifting from norms and institutions to chokepoints and industrial capacity.
This transformation is a strategic gamble. The United States has placed artificial intelligence at the heart of its long-term economic and security plans. AI is not treated as just another sector; it is increasingly seen as the foundation upon which future power will be built. This raises the stakes of dependency. If AI defines the next power hierarchy, losing ground in its material foundations would have systemic consequences.
The result will be a more transactional and infrastructural form of diplomacy than the liberal order is accustomed to. Agreements are evaluated not only in terms of values or alliances, but also in terms of supply-chain resilience, refining capacity and energy security. Territorial disputes are reframed as mineral positioning. Resource access is incorporated into strategic compacts on a scale rarely seen in recent decades.
The contest over AI is unfolding at a technological pace, but its foundations are being laid with long-term intent. What we are witnessing is not merely competition over software or algorithms. Rather, it is the reorganization of international politics around the control of the industrial and energy systems that make artificial intelligence possible.
(A version of this article has appeared in Turkish by Kriter)
