Venezuela has the world’s most oil: Why doesn’t it earn more from exports?

The Trump medication has announced plans for continued subject operations against Latin American cause cartels, pursuing a US onslaught connected a Venezuelan vessel that killed 11 radical connected September 2.

The United States has had a analyzable narration with Venezuela, a state of astir 30 cardinal people, shaped by disputes implicit oil, authorities and information concerns.

Nowhere is that hostility much evident than successful Venezuela’s lipid economy: the state holds the world’s largest proven lipid reserves, yet contiguous earns lone a fraction of the gross it erstwhile did from exporting crude.

How overmuch lipid does Venezuela have?

Estimated astatine 303 cardinal barrels (Bbbl) arsenic of 2023, Venezuela is location to the largest known reserves of oil.

Saudi Arabia ranks 2nd with 267.2 Bbbl, followed by Iran astatine 208.6 Bbbl and Canada astatine 163.6 Bbbl. Together, these 4 countries relationship for much than fractional of planetary lipid reserves.

The United States, by comparison, holds astir 55 Bbbl, placing it ninth globally. This means that Venezuela’s reserves are much than 5 times larger than those of the US.

Globally, proven lipid reserves, which measurement the quantities of crude lipid that are economically recoverable with existent technology, full astir 1.73 trillion barrels.

Where are Venezuela’s oilfields?

Venezuela’s lipid reserves are concentrated chiefly successful the Orinoco Belt, a immense portion successful the eastbound portion of the state stretching crossed astir 55,000 quadrate kilometres (21,235sq miles).

The Orinoco Belt holds extra-heavy crude oil, which is highly viscous and dense, making it overmuch harder and much costly to extract than accepted crude. Producing lipid from this portion requires precocious techniques, specified arsenic steam injection and blending with lighter crudes to marque it marketable.

Because of its density and sulphur content, extra-heavy crude usually sells astatine a discount compared with lighter, sweeter crudes.

(Al Jazeera)

The country’s lipid accumulation is dominated by PDVSA (Petroleos de Venezuela, SA), the state-owned lipid company, which controls astir of the Orinoco Belt operations. PDVSA has historically faced challenges, including ageing infrastructure, underinvestment, mismanagement and the effects of planetary sanctions, each of which person constricted Venezuela’s quality to afloat exploit its immense reserves.

Venezuela has immoderate of the cheapest gasoline (petrol) prices successful the world, acknowledgment to extended authorities subsidies. As of September 2025, the terms of 95 octane gasoline is 0.84 Venezuelan bolivars per litre, which is astir $0.04 per litre oregon $0.13 per gallon. This is conscionable somewhat much costly than successful Libya and Iran, 2 different large oil-producing nations, wherever gasoline costs astir $0.03 per litre oregon $0.11 per gallon. For comparison, the mean terms of gasoline astir the satellite is $1.29 per litre oregon $4.88 per gallon.

How overmuch lipid does Venezuela export?

According to information from the Observatory of Economic Complexity (OEC), Venezuela exported conscionable $4.05bn worthy of crude lipid successful 2023. This is acold beneath different large exporters, including Saudi Arabia ($181bn), the US ($125bn), and Russia ($122bn).

In summation to crude, Venezuela exports smaller volumes of refined petroleum products specified arsenic gasoline and diesel, but these stay constricted compared with its imaginable owed to ageing refinery infrastructure, method challenges and sanctions.

(Al Jazeera)

Why person lipid exports dwindled implicit time?

Venezuela was a founding subordinate of OPEC, joining astatine its instauration connected September 14, 1960. OPEC is simply a radical of large oil-exporting countries that enactment unneurotic to negociate proviso and power planetary lipid prices.

The state was erstwhile a large lipid exporter, particularly aft PDVSA was created successful 1976 and overseas lipid companies were nationalised. In the precocious 1990s and aboriginal 2000s, Venezuela supplied astir 1.5 to 2 cardinal barrels per time to the United States, making it 1 of America’s largest overseas lipid sources.

However, exports began to diminution sharply aft Hugo Chavez was elected president successful 1998, arsenic helium reshaped the country’s lipid sector, nationalising assets, restructuring PDVSA, and prioritising home and governmental objectives implicit accepted export markets. Political instability, mismanagement astatine PDVSA and underinvestment successful infrastructure besides led to falling production.

The concern worsened nether President Nicolas Maduro, Hugo Chavez’s successor, erstwhile the Trump medication imposed US sanctions, archetypal successful 2017 and past tightened those successful 2019. These measures restricted Venezuela’s quality to merchantability crude to the US and constricted entree to planetary fiscal markets, further reducing the country’s lipid exports.

As a result, exports to the US virtually ceased, and Venezuela shifted overmuch of its lipid commercialized to China, which became its largest buyer, on with different countries specified arsenic India and Cuba.

Venezuela’s lipid exports emergence to nine-month high

Following much than 3 years without lipid shipments, successful November 2022, the US Department of the Treasury granted Chevron, 1 of the largest American multinational vigor corporations, a short-term licence to resume constricted lipid accumulation and exports from Venezuela. Chevron resumed immoderate lipid accumulation and exports, but lone astatine a constricted scale, arsenic the licence came with strict restrictions connected the gross generated from these activities.

Signage is displayed astatine a Chevron Corporation petrol presumption successful El Segundo, California, United States, connected April 27, 2020 [File: Kyle Grillot/Bloomberg]

In 2023, the Biden medication continued to renew Chevron’s licence, allowing it to transportation retired constricted operations successful Venezuela. The resumption of operations was portion of a broader strategy aimed astatine expanding planetary lipid supplies and pressuring Venezuela’s authorities to marque governmental concessions.

While the licence allowed Chevron to resume its concern with Venezuela’s state-owned lipid company, the scope of operations remained constricted by US sanctions, ensuring that the Venezuelan authorities did not straight payment from the lipid revenues.

With the instrumentality of the Trump medication successful January 2025, aft a palmy bid for re-election, President Trump issued an enforcement bid successful March 2025, imposing a 25 percent tariff connected each goods imported into the United States from immoderate state that imports Venezuelan oil, either straight oregon indirectly. This measurement was designed to enactment further unit connected nations, specified arsenic China, Russia and India, that had been expanding commercialized with Venezuela contempt US sanctions. The tariff aimed to curb the travel of Venezuelan lipid into planetary markets portion attempting to isolate the Maduro authorities economically.

The tariff achieved constricted success: India’s Reliance Industries stopped buying Venezuelan oil, but China continued its imports contempt the menace of tariffs.

By September 3, 2025, Venezuela’s lipid exports surpassed 900,000 bpd, the highest level since November 2024, marking a nine-month high. However, exports stay importantly little than their pre-sanction levels.