Venezuela in the Headlines (Part 3): Beyond Trump’s Term, How Far Can Venezuelan Oil Really Go?

In Part 1 of this series, we traced how Venezuela fell from a 3+ million b/d powerhouse to today’s diminished state, and in Part 2 we assessed what is realistically achievable over the next three years in terms of production recovery, trade flows, and sanctions‑driven constraints. This third and final article looks beyond Trump’s term to examine how far Venezuelan oil production can go over the next decade and what that means for long‑term investment, global crude trade, and the energy transition.

Bottom Line Up Front: Venezuela’s oil sector will not be “fixed” within Trump’s second term; the real story is what happens well beyond 2028, when years of policy, capital allocation, and security decisions either release a prolonged recovery or cement Venezuela as a structurally impaired, high-risk producer. Over the longer term, the combination of the world’s largest alleged oil reserves and a degraded, capital-starved asset base creates a wide cone of outcomes – from a 3+ million barrel per day (b/d) heavy-sour crude supply workhorse reshaping global flows – to a chronically underperforming petrostate whose barrels miss delivery windows, come in below plan, and are heavily discounted.

Investment in Venezuela’s oil industry will not be for the risk averse. An S&P Global Energy CERA analysis ranked Venezuela last out of 112 rated jurisdictions for attractiveness for oil and gas investment. The report cited a capacity depleted national oil company, dilapidated infrastructure, a lack of contractual sanctity, widespread corruption and violence against oil sector personnel and facilities. Many of the major international oil companies experienced financial losses from the previous two expropriations of oil producing assets by the Venezuela governments.  These corporations have long institutional memories.

Investment scale and timelines beyond 2028

Analysts converge on one core point: rebuilding Venezuela’s oil industry is at least a decade-long endeavor measured in the $100-billion range, not a quick three-year sprint. Estimates for the capital required to restore production to something approaching 1990s levels (around 3-3.5 million b/d) range from roughly $80-100 billion over ten years to more than $180 billion through 2040, depending on decline assumptions and the breadth of upstream and midstream rehabilitation required.

• JPMorgan and others see a plausible path to about 2.5 million b/d over the next decade under optimistic conditions, implying a sustained program of brownfield work, upgrader refurbishment, and selective new developments.
• Some forecasts suggest roughly $10-20 billion per year in upstream and infrastructure spending is required in later phases to move from “stabilization” toward genuine growth.

From the early 2030s onward, the trajectory of Venezuelan output will largely reflect decisions made in this and the next presidential term – whether legal, fiscal, and security frameworks are credible enough to underwrite this scale of long-cycle capital. Many credible forecasts – including the Center for Strategic & International Studies (CSIS) and Enverus –  are tempered with projections below 3 million b/d by the mid-2030s.

Contracting, governance, and human capital

Long-term investment is ultimately a function of above-ground conditions. Years of expropriation, payments in arrears, and politicized decision-making under Chávez and Maduro fundamentally damaged Venezuela’s reputation with international oil companies (IOCs), and the Trump operation did not erase that history.

Over a post-Trump, post-transition horizon, three structural questions dominate:

• Legal and fiscal regime. Investors will require durable production-sharing agreements, or Joint Venture terms that cannot be reversed overnight; this likely means further legislative reform, stronger judicial independence, and clear protections against expropriation and windfall levies.
• Debt overhang and creative finance. With over $100 billion in outstanding obligations cited in analyses, long-term growth may need to be coupled with debt restructuring. This further complicates investment and adds to the risk profile. ​
• Rebuilding human capital. A generation of PDVSA technical staff now works abroad; re-attracting that expertise and international oil company personnel requires improved security, professional autonomy, and the perception that Venezuela is a stable, rules-based environment for technical careers.

If a credible, reform-minded government consolidates and endures beyond 2028, then long-term projects – such as Orinoco redevelopment, offshore gas, and new export corridors – become financeable; if not, Venezuela remains a place where only niche players and opportunistic investors with high risk tolerances will invest leaving a lot of the potential resources in the ground.

Long-run implications for global trade

In the long-term, a reconstituted Venezuelan oil sector might serve as a heavy-sour anchor in a world that still consumes substantial oil even as demand growth slows or peaks. A Venezuelan increase to 2 million b/d by 2030 could trim forward oil price expectations by around $3-4 per barrel, with larger impacts if volumes climb further and arrive into an already well- if not over-supplied world crude market.

Longer-term key structural effects include:

• Competition with Canadian heavy. A sustained increase in Venezuelan heavy-sour exports to the U.S. Gulf Coast and Asia would challenge Canadian barrels at the margin, potentially spurring renewed debates about West Coast pipelines, rail, and diversification to non-U.S. markets.
• Shifts from shadow to visible trade. A move from discounted, opaque exports to China via “shadow fleets” toward more transparent flows to OECD markets could change benchmark relationships, freight patterns, and the discount structure for heavy-sour crudes.
• Refinery configuration and emissions. Long-term availability of Venezuelan heavy-sour crude could extend the life of complex coking and desulfurization assets, but also intensify policy scrutiny of high-carbon, methane-intensive supply chains, especially in regions with tightening climate policies.

In global balances, even a full return to 3 million b/d would contribute only a small amount of world supply, but where and how those barrels clear – U.S. Gulf Coast vs. China vs. Europe – will matter for regional spreads, differentials, and investment decisions.

Energy transition, climate, and stranded-asset risk

Longer-term planning must also contemplate the energy transition. Heavy, carbon-intensive crudes face disproportionate policy and market pressure as jurisdictions roll out carbon pricing, methane fees, and lifecycle-based fuel standards. These issues will likely increase into the 2030s.

How Stillwater can help with long-term strategy

For refiners, producers, traders, and investors, the key long-term questions are no longer simply “how many barrels” but “under what terms, into which markets, and against which competing crudes.” Over the next decade and beyond, strategic decisions will hinge on scenario-based analysis of Venezuela’s production paths, legal reforms, infrastructure choices, and climate-policy interactions.

Stillwater Associates supports clients with:

• Long-horizon scenario modeling of Venezuelan crude supply fundamentals under different political, fiscal, and climate trajectories.
• Asset-level impact assessments for U.S., Canadian, and global refiners and midstream operators facing new competition or partnership opportunities with Venezuelan barrels.
• Strategic advisory on how evolving Venezuela-related risks should shape capital planning, crude-slate optimization, and compliance with emerging environmental and trade policies.

Organizations performing long-term strategy and planning in refining, upstream, trading, or finance can benefit from Stillwater’s data-driven, downstream-focused perspective on how Venezuela’s long-term trajectory may reshape crude markets, infrastructure needs, and policy risk. To explore tailored support on these long-range issues, contact Stillwater Associates to discuss how this evolving story could affect your strategy.