Venezuela’s Oil Comeback Faces Years of Hurdles

• Claudia Emilia Pessango, Director of Upstream Companies and Transactions Research at S&P Global Energy, stated that despite renewed geopolitical attention on Venezuela, the country’s long-anticipated return to global oil markets is unlikely to materially affect oil prices or meaningfully alter global supply in the near term, even as expectations around increased output and international investment have resurfaced.
• Speaking at the 2026 Energy Conference hosted by the Energy Chamber at the Hyatt Regency in Port of Spain, Trinidad, Pessango highlighted that while Venezuela possesses vast geological potential, decades of underinvestment, deteriorated infrastructure, weak operational capacity at the national oil company, and intense competition for global capital mean that any meaningful production recovery will require many years and billions of dollars of investment.
• She observed that recent developments have fueled speculation about a surge in Venezuelan supply, the return of international oil companies, and a revival of the country’s oil sector after prolonged decline; however, oil markets have remained largely unmoved, with prices showing no significant reaction to the news.
• Using historical production data, Pessango illustrated the magnitude of Venezuela’s decline, noting that while production peaked in the 1990s at approximately 3.0–3.5 million barrels per day, output fell from about 2.3 million barrels per day in 2016 to roughly 860,000 barrels per day by November 2020, particularly following the imposition of U.S. sanctions.
• Although output has edged higher since its 2020 low, she described the recovery as slow, long, and narrow, emphasising that current production levels remain too low to materially influence global supply, and that Venezuela today represents a far more diminished variable in global oil markets compared with its historical role.
• Pessango noted that even under S&P Global Energy’s high-case scenario, which assumes regulatory reform and sanctions relief, production might reach around 1.3 million barrels per day by 2026 or 2027, but Venezuela would still account for only about 1% of global crude supply, entering an already oversupplied market where execution constraints, rather than geology, remain the most significant obstacle.

(Source: The Trinidad Express)