Monday, January 12th, 2026
How To Get “P.A.I.D.” From The Recent U.S. Takeover of Venezuela
A week ago, Wall Street wasn’t giving serious thought to the possibility of a “FORCED” regime change in Venezuela to gain control of its vast oil reserves. Most people thought the United States would use the threat of military intervention to renegotiate what had become an untenable situation.
However, the United States removed Venezuela’s long-standing political leader, abruptly reopening questions traders/investors have not seriously asked in years…
Chief among them:
Could Venezuela’s oil sector finally begin to recover, and if so, which companies stand to benefit???
It’s an important question, because on paper Venezuela has the largest proven oil reserves of any country.
This analysis is certainly NOT an endorsement or celebration of those events. It is a response to trader/investor “REALITY”. When geopolitical shifts occur in a country with the WORLD’s LARGEST “PROVEN” OIL RESERVES, capital markets immediately begin assessing EXPOSURE, RISK, and OPPORTUNITY!!!
Venezuela’s oil industry did not collapse overnight, and it will not recover overnight either…
To OVERSTAND/UNDERSTAND what might come next — and which companies are positioned to benefit if policy and sanctions shift — YOU, ME, WE the “BELOVED” ATWWI FAMILY need to OVERSTAND/UNDERSTAND why Venezuela’s oil sector “FAILED” in the first place AND which parts of that “FAILURE” are REVERSIBLE…
The story begins long before the recent invasion and long before U.S. sanctions. The “TRUE” turning point came nearly two (2) decades ago…
In 2007 the Venezuelan government forced foreign operators into “MINORITY” positions and seized assets from companies that refused the new terms.
ConocoPhillips (COP) and ExxonMobil (XOM) were among the most prominent companies affected.
These were not “CONVENTIONAL” oil fields…
The Orinoco Belt consists largely of EXTRA-HEAVY CRUDE, requiring advanced reservoir management, steady diluent supply, and multi-billion-dollar upgraders to convert the “TAR-LIKE” oil into usable blends.
When these companies left, Venezuela lost far more than “CAPITAL”…
It lost ENGINEERING DISCIPLINE, PROJECT MANAGEMENT SYSTEMS, and OPERATIONAL EXPERTISE.
Venezuela’s state?owned oil company, PDVSA, inherited the “ASSETS”, but not the “CAPABILITES”!!!
Production did not collapse immediately. For several years, PDVSA continued operating on the momentum of systems it did not fully OVERSTAND/UNDERSTAND.
BUT, the damage was already embedded…
The DECLINE started shortly after the 2007 expropriation, but STEEP DECLINE became visible (2007:3.3 million bpd* to 2025:900 thousand bpd*) in LONG-TERM PRODUCTION CHARTS around 2015—well before U.S. sanctions targeted PDVSA in 2019. That timing is “CRITICAL” for YOU, ME, WE the “BELOVED” ATWWI FAMILY.
*barrels per day
Let me explain…
Beginning around 2014, PDVSA underwent political “PURGES” that stripped out much of its TECHNICAL LEADERSHIP…
MAINTENANCE BUDGETS were CUT…
COMPRESSORS and UPGRADERS fell into DISREPAIR…
SKILLED WORKERS left the country…
RESERVOIR MANAGEMENT DETERIORATED.
When OIL PRICES “COLLAPSED” in 2014, PDVSA’s “FRAGILE” FINANCES “COLLAPSED” with them…
The result was a RAPID, STRUCTURAL DECLINE IN PRODUCTION…
By the time “SANCTIONS” arrived, Venezuela’s OIL SECTOR was already in “FREEFALL”!!!
U.S. “SANCTIONS” imposed in January 2019 did not cause Venezuela’s collapse, but they did accelerate it “SIGNIFANTLY”!!!
The “SANCTIONS” cut off access to U.S. REFINERS, RESTRICTED PAYMENT CHANNELS, BLOCKED DILUENT IMPORTS, and COMPLICATED SHIPPING and INSURANCE
Thus, barrels that could have been produced suddenly had nowhere to go!!!
“SANCTIONS” did not “BREAK” Venezuela’s oil industry. PDVSA’s “MISMANAGEMENT” did and “SANCTIONS” made any recovery far more DIFFICULT…
This distinction matters, because “SANCTIONS” are also the part of the DECLINE that could REVERSE most quickly.
Now, the GLOBAL FINANCIAL MARKETS are confronting two (2) “REALITIES” that it was not grappling with prior to the “INVASION”:
(1) the United States is the “DE FACTO OVERLORD” of a country with the LARGEST OIL RESERVES IN THE WORLD, and
(2) the possibility that the U.S. may expand its reach over other valuable commodities by making a similar move on Greenland to gain control of its vast reserves of RARE EARTH METALS.
If Venezuela’s oil sector begins to reopen, Chevron (CVX) is uniquely positioned to benefit.
Chevron (CVX) is the ONLY major U.S. oil company that never fully exited Venezuela. Through a series of U.S. Treasury licenses, it maintained joint ventures, kept personnel on the ground, and preserved operational continuity while other Western firms left.
That continuity is a major competitive advantage… Chevron (CVX):
- still has active assets and infrastructure
- knows the reservoirs and upgrading systems
- has established relationships with PDVSA
- is already exporting Venezuelan crude under U.S. authorization
For YOU, ME, WE the “BELOVED” ATWWI FAMILY, this makes Chevron (CVX) the CLEAREST and most IMMEDIATE “BENEFICIARY” of any Venezuelan “NORMALIZATION”. No other Western major company has ACTIVE OPERATIONS, LEGAL AUTHORIZATION, and INSTITUTIONAL KNOWLEDGE in place TODAY!!!
ConocoPhillips (COP) plays a different role…
The company was expropriated in 2007 and later won an $8.7 billion arbitration award for seized assets in the Orinoco region. The ongoing court-supervised sale of Citgo Petroleum is one of the primary avenues for recovery.
If ConocoPhillips (COP) ultimately receives MEANINGFUL COMPENSATION, or reaches a BROADER SETTLEMENT, re-engagement becomes possible. The company retains deep TECHNICAL EXPERIENCE with HEAVY OIL projects.
HOWEVER, unlike Chevron (CVX), ConocoPhillips (COP) would be starting from “SCRATCH”. It has no ACTIVE OPERATIONS in Venezuela today, and its business model has changed significantly since becoming a pure-play “UPSTREAM” company after the Phillips 66 spinoff.
For YOU, ME, WE the “BELOVED” ATWWI FAMILY, ConocoPhillips (COP) represents a SECONDARY and more SPECULATIVE ANGLE, tied to LEGAL OUTCOMES and POLITICAL STABILITY rather than existing operations.
Venezuela’s OIL “COLLAPSE” was not the result of a single event. It was the cumulative effect of EXPROPRIATIONS, LOSS OF EXPERTISE, PDVSA’s INTERNAL BREAKDOWN, and subsequently the impact of “SANCTIONS”.
The investment implications are clear:
- Chevron (CVX) is the “PRIMARY” BENEFICIARY, with existing operations and the ability to scale quickly
- ConocoPhillips (COP) could benefit, but only if legal claims are resolved and political “RISK” declines
- A full-sector recovery would require political stability, credible contracts, and sustained capital — none of which should be “ASSUMED”
For now, Chevron (CVX) remains the company YOU, ME, WE the “BELOVED” ATWWI FAMILY should watch most closely. It has the ASSETS, EXPERIENCE, and REGULATORY FRAMEWORK to move FIRST if Venezuela’s oil sector takes even a small step toward “NORMALIZATION”
That continuity is a major competitive advantage. Since Chevron (CVX) still has “ACTIVE” ASSETS and INFRASTRUCTURE and is already EXPORTING Venezuelan CRUDE under U.S. authorization, it does not need to “RE-ENTER” Venezuela…
It simply needs to “SCALE UP”!!!
“KNEE-JERK” Reaction
As it is apt to do, Wall Street reacted by bidding “UP” shares of CVX by five (5) percent on Monday, January 5th, 2026. That day, TRADING VOLUME in Chevron (CVX) was more than four (4) times its AVERAGE DAILY VOLUME (ADV).
If everything goes according to plan, Chevron (CVX) should soon be able to ramp up its oil production in Venezuela at the same time many of the onerous restrictions imposed seven (7) years ago by the first Trump administration are relaxed or eliminated…
NOTE: HIGHER SALES REVENUES COMBINED WITH LOWER PRODUCTION COSTS EQUAL MORE PROFITS.
HOWEVER, that type of “KNEE-JERK” reaction to an “UNEXPECTED” event usually turns out to be WRONG!!!
That’s because a “SEISMIC” GEOPOLITICAL event of this magnitude has “ENORMOUS” REPERCUSSIONS, some of which cannot be foreseen.
When the United States used its military power to remove the leader of a “SOVEREIGN” NATION and gain control of its NATURAL RESOURCES, a message was sent to the rest of the world…
“MIGHT MAKES RIGHT” and right now the “MIGHTIEST” nation in the world wants what other nations have in the way of PETROLEUM and PRECIOUS METALS.
I don’t know exactly how this latest “GAMBIT” by the White House will play out, but I do know of a way to get “P.A.I.D.” from it
The Fidelity Global Commodity Stock Fund (FFGCX) is a “BELLWEATHER” position that owns shares of companies that produce OIL, MINE FOR METALS, and GROW CROPS.
This fund’s top ten (10) holdings include Chevron (CVX) along with Exxon Mobil (XOM), Archer-Daniels Midland (ADM), and Agnico Eagle Mines (AEM). Its single largest holding is Corteva (CTVA), which provides SEED and CROP PROTECTION for farmers.
In the past, I have utilized this fund as an “HEDGE” against INFLATION.
NOTE: WHEN THE PRICES OF COMMODITIES RISE QUICKLY, PROFIT MARGINS FOR THE COMPANIES THAT PRODUCE COMMODITIES INCREASE BECAUSE THEIR OPERATING COSTS ARE MAINLY FIXED.
Now, I view this fund (FFGCX) as a way to monetize renewed U.S. “IMPERIALISM” to gain control of NATURAL RESOURCES outside its national boundaries.
Today, OIL in Venezuela in play….
Soon, it may be PRECIOUS METALS in Greenland…
Later, it could be FOOD CROPS in some other part of the world.
What just happened in Venezuela could turn out to have a LARGER impact on the GLOBAL FINANCIAL SYSTEM in the long run than the outbreak of the CORONAVIRUS “PANDEMIC” six (6) years ago. It could also end up changing the “DYNAMICS” of the COMMODITY markets for a lot longer than that.
PEACE & BLESSINGS
Kenneth Reaves, Ph.D.