As the geopolitical map of South American oil shifts in early 2026, the contrast between Guyana and Venezuela has never been starker.
In global energy markets, geology is often treated as destiny. If a country has oil, investment and prosperity are assumed to follow. But, in recent years, the contrast between Guyana and Venezuela—two neighbors sitting atop the same prolific basin—offers a powerful rebuttal to that assumption.
The two countries share some similarities, but they occupy completely different economic worlds. One is in the midst of one of the fastest oil‑production ramp‑ups ever recorded. The other is struggling to keep a once‑dominant industry alive after years of political meddling, underinvestment, and capital flight.
Guyana’s Remarkable Sprint
A decade ago, Guyana produced zero barrels of oil. As of January 2026, production is running roughly between 840,000 and 900,000 barrels per day. With the recent ramp-up of the floating production, storage and offloading vessel ONE GUYANA FPSO—the largest and most technologically advanced vessel operating in the Stabroek Block—the country is on track to reach nearly 1.5 million barrels per day in 2027.
That trajectory is extraordinary. Guyana went from a frontier exploration story to a globally relevant producer in less time than it takes to permit a single major pipeline in parts of North America.
The explanation is not just the quality of Guyana’s light, sweet crude, although that is certainly a factor. It is the institutional framework the country put in place. By partnering early with an ExxonMobil-led consortium and maintaining a stable, predictable contractual environment, Guyana allowed capital and expertise to flow rapidly. The economic results speak for themselves: GDP growth of nearly 20% in 2025 and a projected 16.2% in 2026, making Guyana the fastest-growing economy in the world.
Venezuela’s Missed Opportunity
Just across the border sits Venezuela, home to the world’s largest proven oil reserves—approximately 303 billion barrels. On paper, it should be one of the wealthiest energy producers on Earth. In practice, in recent years production has fallen below 1 million barrels per day—roughly on par with Guyana’s current production, despite Venezuela’s vastly larger resource base.
The turning point came in 2007, when President Hugo Chávez forced the expropriation of assets owned by ExxonMobil and ConocoPhillips. The belief at the time was that Venezuela could seize the physical infrastructure—wells, upgraders, and facilities—and operate them with state-appointed managers.
What could not be seized was technical expertise, access to global supply chains, or the capital required to sustain complex oil operations. Over time, infrastructure deteriorated, production collapsed, and facilities meant to anchor Venezuela’s oil future became symbols of chronic underinvestment and mismanagement. These factors led to a steep production decline, which was exacerbated later by economic sanctions.
A Sudden Pivot In 2026
Recent events have made the contrast even sharper. Following the January 3 detention of Nicolás Maduro and subsequent U.S. intervention, Venezuela’s interim government has moved quickly to reverse decades of policy.
Interim President Delcy Rodríguez has now signed legislation opening Venezuela’s oil sector to privatization. This marks a dramatic reversal of two decades of state‑dominated energy policy and is a move that would have been politically unthinkable just months ago. U.S. sanctions are beginning to ease, and reports indicate that American oil executives are once again surveying Venezuelan assets for the first time in nearly twenty years.
Still, reality imposes limits. Guyana’s success was built over two decades of trust and consistent policy. Venezuela’s decline was shaped by two decades of contract abrogation and capital destruction. According to a January 6, 2026 Rystad Energy report, Venezuela would need $183 billion in investment to restore crude output to 3 million barrels per day, roughly the level it produced before the 2007 expropriation.
The Investor Takeaway
Guyana’s experience underscores a fundamental truth about the energy business: capital goes where it is welcome—and stays where it is treated well. ExxonMobil CEO Darren Woods recently noted that the company is now considering exploration closer to Venezuela’s border as geopolitical risks have eased. The irony is hard to miss.
While Venezuela is attempting to lure back the very companies it once expelled to repair a broken industry, those same firms are setting production records just miles away in Guyanese waters.
For energy investors, reserves alone are never the whole story. They are only numbers until paired with a stable legal framework, competent operators, and political restraint. Guyana lacked those elements twenty years ago and deliberately built them. Venezuela had them—and dismantled them.
As attention turns to Venezuela’s attempted reset, the smarter bet may not be on the vast barrels trapped in Orinoco heavy crude, but on the FPSOs steadily delivering Guyana’s oil to global markets. Guyana didn’t just discover oil. It learned how to manage it.
Follow Robert Rapier on LinkedIn or Facebook