What will happen in the international oil market following the United States' intervention in Venezuela?

1. Fall in Venezuelan production
2. Obsolete infrastructure
3. Call to US oil companies
4. Consequences for Spanish companies

The reaction of the international oil market to the United States' intervention in Venezuela has been more limited than expected: on Monday, 5 January, the price of oil was virtually unchanged, with an average price decline of 0.6%. A barrel of Brent (the benchmark for the European market) was trading at £60.42, 0.5% less than in the previous session, while West Texas Intermediate (WTI, the benchmark for the American market) was trading at £59.96 per barrel, 0.6% less.

In case there were any doubts, OPEC+ (which includes OPEC countries, plus Russia, Kazakhstan, Azerbaijan, Malaysia, Mexico, Bahrain, Brunei, Oman, Sudan and South Sudan, oil-producing countries that do not belong to the organisation) has clarified in a statement that the events in Venezuela will not change its plans to keep its crude oil supply stable at least until next April.

Oil closed 2025 with a year-on-year decline of close to 20%, due to excess supply. Both Brent and WTI recorded their largest percentage declines since the pandemic.

Fall in Venezuelan production

With this data in mind, one of the arguments that has been repeated most often in recent hours to explain the United States' intervention in Venezuela and the arrest of Nicolás Maduro loses weight: the Trump administration's desire to gain control of Venezuela's significant oil reserves.

It should be noted that Venezuela's current oil production is very low; in fact, the state of New Mexico has a higher annual crude oil production than the Caribbean country. Even the United Kingdom has a production level very similar to Venezuela's: just 100,000 barrels less per year.

It is true that Venezuela has the largest proven oil reserves in the world, concentrated in the so-called Orinoco Oil Belt. However, this is a highly concentrated crude oil, which requires the use of diluents and special technology for its extraction, complicating and increasing the cost of operations.

Oil extraction in this area requires prior investment in the construction of a specialised refinery capable of processing this type of crude oil, as well as specialised labour and logistical infrastructure. For this reason, the price per barrel of extraction would skyrocket, making extraction unprofitable from an economic point of view.

Furthermore, these types of refineries emit large amounts of CO2 into the atmosphere, which would further complicate the situation from an environmental point of view.

According to OPEC data, Venezuela's proven reserves in 2024 were 303.22 million barrels. However, five years earlier, in 2020, these reserves amounted to 303.56 million barrels. The conclusion is that in these five years, hardly any oil has been extracted from these reserves.

Thus, although according to data from the United States Energy Information Administration (EIA), Venezuela accounts for approximately 17% of the world's proven oil reserves, its current production is only a fraction of that amount.

Obsolete infrastructure

The explanation is that, since the early 2010s, the lack of investment in infrastructure maintenance and modernisation, coupled with US sanctions on the Venezuelan oil sector, has led to a drastic reduction in Venezuela's oil production.

At the beginning of the 21st century, production amounted to more than three million barrels per day (the record is 3.7 million barrels per day in 1997). In 2024, however, average production barely reached 921,000 barrels per day.

This has caused Venezuela to disappear from the ranking of the world's largest oil producers, which is headed by the United States, followed by Saudi Arabia, Russia, Canada and China.

A recent study by energy consultancy Wood Mackenzie estimates that getting Venezuela back to producing 1.5 million barrels per day would cost between $20 billion and $30 billion, not including the maintenance of oil and gas pipeline infrastructure, which would require a similar investment.

Making the leap to a production of 3 million barrels per day, close to the 1997 record, would require investments of between £85 billion and £130 billion over a period of ten years, according to the consultancy firm.

Call to US oil companies

With the aim of modernising and reviving Venezuela's oil production, which is in dire need of investment, the Trump administration has made an offer to the executives of the major US oil companies, many of whose assets in Venezuela were seized by the Bolivarian government.

Trump is now offering these companies the chance to recover those assets, or at least receive compensation for their confiscated properties, in exchange for returning to Venezuela and investing in the revival of the country's oil industry.

In this way, the Trump administration is ensuring, on the one hand, that US companies expand their markets and recover what they lost due to the expropriations of Chávez and Maduro, and on the other hand, that a sector that is very important for Venezuela's economy is rebuilt, thus offering better prospects for the population and minimising the possibility of a new uprising or coup d'état.

Among the oil companies most interested in returning to Venezuela is ConocoPhillips, which obtained an award in its favour of $11 billion for the expropriation of its Petroznata, Hamaca and Golfo de Paria fields.

For its part, ExxonMobil obtained $900 million in compensation in 2011 for the nationalisation of its Cerro Negro and La Ceiba fields. In addition, in 2023, a new ruling awarded it $77 million in compensation.

The only US oil company that has maintained its operations in Venezuela is Chevron. Although the original debt to the oil company amounted to $5 billion, a special licence from the US government allowed it to continue exporting oil, enabling it to recover a large part of that amount.

Consequences for Spanish companies

The United States' intervention in Venezuela has changed the game, with the interests of major Spanish companies also at stake.

Obviously, the main company involved is the oil company Repsol, which, at the end of the first half of 2025, had a debt of €358 million that, in principle, was to be paid with crude oil. However, this operation was halted due to the embargo imposed by the United States.

Sources close to the company say that discreet negotiations are underway with the US authorities to reach an agreement that will allow the Spanish company to repatriate the oil.

Apart from the oil sector, other major Spanish companies are waiting to see how events unfold so that they can recover their debts from the Venezuelan government: BBVA (€180 million in dividends); Iberia (€200 million); Air Europa (€180 million), Telefónica (€200 million); Meliá (€140 million); and Duro Felguera (€120 million).