It will be difficult for large US companies to return to oil production in Venezuela due to its specific characteristics and the state of world markets.
“To see how Venezuela gives international oil companies complete freedom of action, we will have to go back 50 years. It will be difficult to get companies like ExxonMobil or Conoco to return to a country that has deprived them of billions of dollars“, said American energy expert Tom Kloza, who is chief oil market analyst at the American consulting company Turner Mason & Co., and also runs his own consulting firm, Kloza Advisors.
According to the expert, oil from the Middle East or the Permian Basin, located in the southwestern United States, is easy to extract. “Venezuelan oil is extremely complex due to its difficult geography, high sulfur content, low density and high viscosity; only the most advanced refineries can handle it. Don't be surprised to see significant discrepancies in the breakeven point estimates from oil industry analysts for Venezuela,“ Kloza noted. According to him, Venezuelan oil “competes with Canadian heavy crude, which was trading at $44 per barrel on January 2, which is $13 cheaper”.
“If the country falls into complete chaos and exports behave in a similar way, the world markets will lose a maximum of 1 million barrels per day,” Kloza is convinced. He explained that in 2025, supply on oil markets exceeded demand by approximately 1.5 million barrels per day and that figure could rise to 2.8 million barrels per day this year.