“Venezuela is uninvestable”
That’s the blunt word ExxonMobil CEO Darren Woods used — not because the barrels aren’t there, but because the rules of the game (legal, commercial, contractual protections) still don’t feel durable enough for long-cycle capital.
What makes this moment interesting is the contrast playing out in real time.
In the same White House meetings (Jan 9–10, 2026) where Woods warned Exxon has already had assets seized twice — “to re-enter a third time would require… significant changes” — Chevron’s vice chairman Mark Nelson sounded ready to move. He said Chevron could increase liftings by 100% immediately, and lift production by about 50% over the next 18–24 months (within its “disciplined investment schemes”).
So… what changed?
The conversation shifted from “Venezuela” to “framework.” The U.S. convened major oil CEOs and talked openly about mobilizing investment to rebuild the industry (with talk of big numbers like $100B).
Then came a signal about cashflow control. An executive order aims to protect Venezuelan oil revenues held in U.S. Treasury accounts from attachment/creditor seizure — explicitly framing judicial action against those funds as a national security and foreign policy risk.
All of which sets up the real investor reality: Venezuela isn’t a simple “go / no-go.” It’s a layered decision where upside (scale, resource depth, optionality) sits right beside structural dilemmas — about risk/reward, fiscal stability, who controls cashflows, and whether the rules stay consistent long enough to justify capital.
The dilemma for oil companies (through a risk / fiscal lens)
1) Risk & reward: the risk isn’t just subsurface anymore
Commodity price volatility is normal. The harder question is convertibility: can you reliably lift, sell, collect, and repatriate cash over time?
2) No “one size fits all”
Venezuela isn’t a single bet. Brownfield recovery, heavy-oil logistics, diluent constraints, and infrastructure rebuild each carry different risk profiles — and should demand different commercial structures and fiscal tuning.
3) Fiscal stability: long-cycle money hates moving goalposts
Upstream projects can span 30–40 years. Investors can tolerate technical and market uncertainty — but legal/fiscal uncertainty raises hurdle rates fast (or redirects capital).
4) Progressivity
A progressive, predictable system reduces pressure for ad-hoc “rent grabs” when prices rise — and helps align incentives over decades.
5) Simplicity
Simplicity matters because financing, governance, compliance, and controls already add layers — especially in a re-entry environment.
If you were sitting on an IOC investment committee, what would be your non-negotiable condition before calling Venezuela investable again?
