Why US Oil Giants Are Making A U-Turn On "Uninvestable" Venezuela Now

Representatives from US oil companies have begun visiting Venezuela to hold meetings with government officials and assess potential projects in the country’s oil sector following the ouster of President Nicolás Maduro in January this year.

Many gathered at the “heavily guarded” JW Marriott in Caracas, where industry representatives presented plans to revive ageing oil fields, The Wall Street Journal reported. Several executives met with acting president Delcy Rodríguez, who has been engaging with foreign investors.

“It was unmistakable, the sense of impending opportunity. There were so many Americans meeting with so many Venezuelans… both sides are engaged in a constructive way, with a shared vision of making things function better and getting production up,” Jon Hughes, chief executive of Petrie Partners, said as quoted by WSJ.

Companies that had previously stayed away from Venezuela are now reviewing opportunities. ExxonMobil and ConocoPhillips have sent technical teams to the country in recent weeks. Exxon reportedly inspected the Cerro Negro heavy-oil project it operated before nationalisation in 2007 while Conoco is assessing oil and gas prospects.

Neither company has committed investment so far but their recent engagement contrasts with their stance earlier this year. Exxon CEO Darren Woods had described Venezuela as “uninvestable” but in a recent earnings call, he said, “Venezuela is a huge resource that’s now opened up more freely to the world,” adding that producing heavy oil “in a low-cost way is going to be absolutely critical.”

The renewed activity comes as global oil prices have risen sharply this year due to Iran-linked conflict in the Middle East and recent changes in Venezuela’s energy laws.

Rodríguez has sought to reassure companies about the country’s direction. Bryan Sheffield of Formentera Partners, who met her in Caracas, said she is working to build ties with energy executives but noted that investment decisions would take time.

The US government has also increased engagement. President Donald Trump’s energy adviser and executive director of the National Energy Dominance Council Jarrod Agen visited Caracas with a delegation of companies that signed memorandums of understanding to explore operations in Venezuela.

He said improved connectivity, including the return of direct commercial flights, could support business activity. “How do you get the employees down here? How do you get executives down here?” he said.

On the ground, crude flows are already increasing. Shipments of Venezuelan crude to the US Gulf Coast have risen in recent months. In March, imports were about 457,000 barrels a day, as per report citing data from Kpler. This is the highest since January 2019 when the Trump administration imposed sanctions on state-run Petróleos de Venezuela.