Venezuela’s growing uncertainty around continued easing of sanctions

An uncertain outlook for Venezuela’s oil and gas sector persists. The government has only minimally complied with the agreement allowing a free and fair process in the run-up to the presidential elections in 2024. We don’t expect any oil and gas companies currently in Venezuela to consider reviving major investment in the country unless there is an extension of the sanctions-lifting licence. In the short term, any reliable upside in oil production is assumed to come from Chevron-operated fields. We don’t yet see any significant change in the flows of crude trade between Asia and the US. Negotiations for the development of the Dragon offshore gas field may be impacted by the border dispute with Guyana. Trinidad and Tobago has sided with Guyana, and any escalation of the conflict could delay or permanently disrupt ongoing talks between the involved parties. For now, the viability of other transboundary offshore gas opportunities is also uncertain.