Major U.S. oil companies Exxon and Chevron announced on January 30th that they do not intend to increase their capital expenditures in Venezuela this year. They are adopting a wait-and-see approach, observing the progress of legal and political reforms aimed at making the country more attractive for foreign oil investments.
President Donald Trump has consistently stated that U.S. oil companies would invest over $100 billion in Venezuela to revitalize its deteriorating infrastructure, contingent on the removal of Nicolás Maduro. However, Exxon Chairman and CEO Darren Woods reportedly drew the President’s displeasure earlier this month when he informed Trump that Venezuela would not see significant investment until legal reforms are implemented and genuine stability is achieved. This caution stems from Exxon’s experience of having its oil assets expropriated in Venezuela less than two decades ago.
Following this exchange, Trump commented that Woods’ remarks were “disappointing” and suggested he might consider excluding the world’s largest oil company from Venezuela.
On January 30th, during his fourth-quarter earnings call, Woods expressed his belief that the Trump administration is committed to enacting the necessary changes to eventually make Venezuela a viable investment destination, though the timeline remains uncertain. Venezuela’s National Assembly began approving reforms to its oil and gas laws on January 29th.
“Venezuela has those challenges that I mentioned, which I believe in time will get addressed,” Woods stated, also citing the high cost of extracting and processing Venezuela’s extra-heavy, tar-like crude oil as another hurdle.
He added that Exxon possesses expertise in producing heavy oil sands in Canada, which could be transferable to Venezuela.
“We think we bring an advantaged approach that will lead to lower-cost production, higher recovery and, therefore, more economic barrels onto the marketplace. That’s I think the opportunity set that will play out over time,” Woods explained, noting that Exxon still plans to send a small technical team to Venezuela in the near future to assess the situation.
Chevron, conversely, is currently the only U.S. company producing oil in Venezuela, operating under a special license. Chevron produces approximately 250,000 barrels of oil per day, representing about a quarter of Venezuela’s total daily output of nearly 1 million barrels.
Chevron Chairman and CEO Mike Wirth reiterated that the company could increase its oil production by 50% in under two years. This would raise Venezuela’s total output to just over 1.1 million barrels per day, a modest increase for a country possessing the world’s largest proven oil reserves, which peaked decades ago at nearly 4 million barrels per day.
Notably, Wirth stated that Chevron’s Venezuelan operations are self-funded through its joint ventures with the state oil company PDVSA, and there are no immediate plans for additional capital investment.
“I think it’s a little early to say what our longer-term outlook is,” Wirth commented during his earnings call. “You should expect us to remain focused on value and capital discipline. It’s a large resource that has the opportunity to become a more sizable part of our portfolio in the future, but we also need to see stability in the country. We need to have confidence in the fiscal regime.”
Wirth mentioned that Chevron is reviewing the newly approved hydrocarbons law and is monitoring several key indicators.
“Like anywhere we invest, fiscal terms, stability, regulatory predictability are important. So it will have to compete in our portfolio versus attractive investments in many other parts of the world,” Wirth added. “With the right changes, we certainly could see our operations and the footprint expand in Venezuela. And we’re working with the U.S. government and the Venezuelan government to try to create circumstances that would enable that.”
Earnings beats
Both Exxon and Chevron reported better-than-expected quarterly earnings. However, both companies are experiencing declining profits, largely due to lower crude oil prices, which currently make Venezuelan investments less appealing.
Despite the weaker commodity market, Chevron achieved its highest oil and gas production volumes on record, while Exxon reported its greatest output in over 40 years.
Exxon’s stock saw a slight decrease of 1%, while Chevron’s stock increased by more than 1%.
More than half of Exxon’s production originates from the thriving Permian Basin in West Texas and its rapidly growing output from offshore Guyana, which borders Venezuela. Chevron, the second-largest Permian producer after Exxon, became Exxon’s primary partner in Guyana following its $53 billion acquisition of Anadarko Petroleum last year.
Woods indicated that Exxon is awaiting a ruling from the International Court of Justice arbitration regarding a border dispute over international waters between Guyana and Venezuela. A favorable decision could open up further offshore exploration opportunities for both Exxon and Chevron.
“Obviously, with the developments in Venezuela, perhaps we’ll see an opportunity with less naval patrols that will make it a little more friendly environment,” Woods remarked, expressing optimism. “We will have an opportunity to do what we need to do in that portion of the [exploration] block when it’s available to us.”
Exxon reported fourth-quarter earnings of $6.5 billion, a 15% decrease year-on-year from $7.6 billion. Full-year 2025 earnings were $28.8 billion, down 14% from $33.7 billion in 2024.
Chevron reported quarterly earnings of nearly $2.8 billion, a decrease of almost 15% year-on-year from over $3.2 billion. Full-year profits amounted to $12.3 billion, a 30% drop from $17.7 billion the previous year.