On 3 January 2026, the US military swooped into Caracas, Venezuela, and arrested the country’s president, spiriting him back to prison in the US. Nicolás Maduro had been president of Venezuela since 2013 and succeeded Hugo Chávez in the role. The upending of Venezuela’s leadership has led to a renewed interest in the country’s premier resource, oil. The country has the largest amount of proven reserves of any country at approximately 303 billion bbl, according to the US Energy Information Administration (EIA) (Fig. 1). These reserves have been languishing lately, with the country’s output plummeting 82% since 1999 (Fig. 2), according to the Italian Institute of International Affairs. “Venezuela is a huge brownfield,” said Luis Pacheco, a nonresident fellow at Rice University’s Baker Institute, “because it was developed, abandoned, and now, actually, is in the process of being redeveloped.” Pacheco spoke at the 2026 Offshore Technology Conference in Houston about the damage caused by the country’s shriveling oil industry and the opportunities and potential that now exist there. Before joining the Baker Institute, Pacheco spent 17 years at Petróleos de Venezuela, S.A. (PDVSA), Venezuela’s national oil company. “Venezuela has been becoming a subject of news, subject of hope, subject of destiny, subject of interest,” he said. He warned, however, that this renewed interest has led to misinformation and expressions of superficial expertise without nuance. Placing the blame for Venezuela’s cratering oil production simply on the country’s leadership, or a particular policy, or the price of oil would be a mistake, Pacheco said. “It is a number of factors that have worked together, and sometimes one multiplies the other.” This integration runs deep. Pacheco pointed out that the welfare of Venezuela and Venezuelans is intertwined with the welfare of its oil industry. The oil industry, he said, has been called the locomotive of the economy, a locomotive, he added, that has been “derelict in the past decade, at least.” Getting that locomotive back up to speed, Pacheco said, requires the bolstering of four pillars: resources and reserves, market opportunities, people and technology, and an attractive institutional framework. The resource and reserves pillar is clearly the strongest. “Most of the country is an oil basin,” Pacheco said, “although that is an exaggeration.” The Orinoco Belt in the southern part of the country is the world’s largest known ultraheavy oil deposit. The Maracaibo Basin in the northwest contains conventional light and medium crudes and is Venezuela’s oldest and most developed basin. The eastern part of the country has mature conventional fields with significant gas coproduction, and offshore gas fields also provide opportunities (Fig. 3). Together, these reserves constitute approximately 17% of the world’s proven oil reserves, according to the EIA. Venezuela certainly has the resource pillar covered, but Pacheco said that pillar alone is not sufficient without the other three, and they are not nearly as stable. Regarding the markets pillar, Pacheco raised the question of whether, in an age of energy transition and the proliferation of renewable resources, the market for Venezuela’s reserves will be strong enough. “The trends here is that, even though there may be a scenario where, in the next 25 years, there is a decrease in oil demand, there’s still a need for new oil to be added … . And that’s exactly where Venezuela would fit, because it’s one of the few countries in the world, one of the few basins in the world, that has the capacity to grow in a significant manner in order to comply with that demand.”
Adam Wilson (Mon,) studied this question.