The global oil industry is experiencing one of its most turbulent periods in decades. What had been a market heading toward stability at the start of 2026 was shaken within days by the outbreak of military conflict between the United States and Iran. The repercussions are being felt throughout the global energy chain, and their effects on Latin America, and Venezuela in particular, are only just beginning to unfold.
On February 28, 2026, joint airstrikes on Iran triggered the effective closure of the Strait of Hormuz, the world’s most critical maritime corridor for energy transport. Before the conflict, nearly 20 million barrels per day passed through that strait, equivalent to one-fifth of global consumption. According to the International Energy Agency’s (IEA) Oil Market Report, tanker traffic plummeted to less than 10% of its previous levels, forcing Gulf producer countries to cut production by at least 10 million barrels per day. Brent, a type of light crude oil extracted from the North Sea, was trading at around $70 at the end of February and surpassed $120 in a matter of days.
The disruption is not limited to crude oil. The closure of the Strait also halted liquefied natural gas exports from Qatar, which accounts for about one-fifth of global supply, and hit the fertilizer, petrochemical, and air cargo markets, posing a significant threat to energy security. J.P. Morgan warned that the price per barrel could exceed $150 if the disruptions continue into mid-May.
In response to the crisis, IEA member countries agreed to release 400 million barrels from their strategic emergency reserves—the largest collective action of its kind in the organization’s history—succeeding in bringing the price back to levels near $92. However, analysts at Oxford Economics and Deloitte agree that as long as the Strait remains closed, these containment measures offer only temporary relief.
The conflict took many markets by surprise, but not Washington. Months earlier, the Trump administration had already outlined a hemispheric energy security strategy whose central objective is to ensure access to hydrocarbon sources that do not depend on geopolitically vulnerable corridors in the Middle East. In that strategy, Venezuela occupies a strategic position of the utmost importance.
Venezuela holds the world’s largest proven reserves, estimated at over 300 billion barrels, but its current production stands at just 800,000 to 900,000 barrels per day—a fraction of the more than 3 million barrels it produced in the 1990s. The problem is that boosting oil production will take time, investment, and, above all, a legitimate institutional framework that allows for the orderly management of assets and ensures clear rules for all stakeholders.
Although the regime’s National Assembly approved a reform to the hydrocarbons law in January that eliminates the requirement for PDVSA to be the majority shareholder in all projects, allows for the negotiation of lower royalties, and enables international arbitration for dispute resolution, this reform is still insufficient to generate the confidence required by a capital-intensive industry, especially in the absence of institutional checks and balances and full guarantees of transparency in decision-making.
According to Reuters’ coverage of CERAWeek in Houston in March 2026, major oil companies have once again made the exploration of new reserves a priority, after years of focusing on dividends and share buybacks. Shell stated at that conference that it is actively evaluating projects in Venezuela and could make investment decisions before the end of the year, if the country’s fiscal and legal situation allows it.
Private-sector reserves remain substantial. ExxonMobil’s CEO told Trump himself that Venezuela was “uninvestable.” Chevron has made its expansion contingent on financing it with internal cash flows, without new capital. The underlying problem is the lack of a clear electoral process, a politicized judicial system, and a chain of command over assets that remains legally contested in both Caracas and Washington.
The current situation presents a tremendous window of opportunity for Venezuela to reclaim its future. The country has the resources. The world needs them. The technology to extract them exists. What remains uncertain is when Venezuela will be able to establish a legitimate and predictable institutional framework that not only attracts investment but also protects the value of its strategic assets and ensures that the sector’s recovery translates into sustainable benefits for the population.
Major oil companies are not only looking for favorable economic conditions, but also for stability and democratic legitimacy resulting from free and transparent elections. Only on that basis can a true rule of law be established, one capable of providing the reliable legal framework required for an investment of this magnitude.
