Building an oil economy in Venezuela

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It’s one thing to oust the leader of an authoritarian state. It’s another to rebuild it as a petrostate that can go toe-to-toe with energy-producing giants.

The U.S. captured and extracted Venezuela’s authoritarian Nicolás Maduro over a month ago. Yet that astonishing — and deadly — U.S. military operation seemed a distant memory during Energy Secretary Chris Wright’s three-day swing through the country with interim President Delcy Rodriguez, Maduro’s past deputy.

What comes next is the harder phase: turning regime change into a functioning oil economy — and proving that Venezuela can quickly return as a meaningful crude supplier under U.S. oversight.

Wright has since boasted of future sales of Venezuelan crude that will take place, still under U.S. supervision. He said in a Fox News interview on Tuesday that Venezuelan oil sales have already surpassed $1 billion, and he believes the amount will grow to $5 billion in the “next several months” to benefit an impoverished society.

“This is a win all around and a transformation of a country without any American soldiers on the ground, and without any American taxpayer dollars. This is way out-of-the-box, ground-breaking Trump diplomacy,” Wright said.

He followed it up with another prediction later in the day. At the annual International Energy Administration conference, Wright said Venezuela was able to step up oil production by “several hundred thousand barrels per day,” or around 30% to 40% more as he laid it out to Bloomberg.

Currently, Venezuela produces about one million barrels per day — or about the same amount daily as North Dakota.

Call it the “sell, baby, sell” chapter of President Donald Trump’s risky gamble in Venezuela. It forms a piece of what Wright described last week as an effort to “make the Americas great again that’s similar to forcing a contract on another party under duress.

“We will impose a contractual situation,” Eric Smith, the associate director of the Tulane University Energy Institute said. “We will indeed set aside some of the royalties to support Venezuela, but they'll go into an escrow account and be distributed as long as they're playing ball with the Americans.”

Venezuela’s economic landscape has changed, though analysts observe probably not at the speed that would entice U.S. oil giants to re-establish a major footprint by year’s end. Venezuelan lawmakers approved “hydrocarbon reform” legislation that loosens state control over the oil sector. Chiefly, it does so by handing oil-and-gas firms operational control in their ventures.

Still, there may well be hurdles in the Trump administration’s rush to restore Venezuela’s position as a mighty petrostate. Anas Alhajji, managing director at the Dallas-based Energy Outlook Advisors, observed that trading houses selling Venezuelan crude were struggling to offload new volumes on the energy market.

“U.S. Gulf Coast refiners face challenges absorbing the sudden surge of this extra-heavy oil,” he said in a social media post. He added that half of Venezuelan crude exports were going unsold to buyers as of last week. 

The Treasury Department recently gave a green light for several European oil and gas firms to restart their investment endeavors in Venezuelan projects. The first batch of companies to receive those licenses were BP, Shell $SHEL, Spain’s Repsol, and Italy’s ENI. 

With the sole exception of Chevron $CVX, U.S. oil firms were absent from the licenses. Chevron stayed put when others like ExxonMobil $XOM and ConocoPhilips packed up and left two decades ago after their equipment was expropriated. 

ExxonMobil doesn’t appear to be scrambling to move back in.  Earlier in January, ExxonMobil CEO Darren Woods famously described Venezuela as “uninvestable” under the current circumstances. 

At the time, he said ExxonMobil was willing to send a team of specialists to gather facts on the ground, but there’s no sign they’ll be dispatched soon.

“With respect to the team I offered up given the challenges… We're still committed to doing that,” ExxonMobil CEO Darren Woods said during their Q4 2025 earnings call last month. The company did not respond to a request for comment on the timing of the team’s departure.