As global energy markets continue to navigate a complex landscape, the spotlight has turned to Venezuela—home to the world’s largest oil reserves, totaling 303 billion barrels. Significantly, much of Venezuela’s reserves are made up of heavy crude oil, a grade that is increasingly in demand by the United States.
In recent years, the US has become increasingly reliant on heavy crude imports, with around 70% of total imports now of this type. This trend is largely driven by the US refining infrastructure: Texas and Louisiana alone house six of the world’s largest heavy crude oil refineries, making the US a natural partner for heavy crude producers like Venezuela.
The special operation by the U.S. military in Venezuela that saw President Nicolas Maduro being captured and escorted to the U.S. court raised the prospect of higher production from the U.S. refineries.
This is evidenced in significant premarket movements in US oil stocks on the back of positive news from Venezuela. Shares of major energy companies saw notable gains: Chevron and Valero both surged 11%, ConocoPhillips and Marathon Petroleum rose 10%, Exxon Mobil climbed 7%, Phillips 66 advanced 6%, while Occidental Petroleum, EOG Resources, and Devon Energy each experienced a 4% lift. Kinder Morgan also saw a 3% uptick.
These stock price movements underscore the market’s anticipation of closer energy ties between the US and Venezuela, especially as American refiners seek reliable sources of the heavy crude oil essential to their operations.
Aside from its massive oil reserves, Venezuela is also a major holder of gold. The South American nation leads Latin America in gold reserves, holding 161 metric tons, with a current estimated market value of $22 billion. This substantial gold holding further underlines Venezuela’s significance in the global commodities landscape.
