Stock investors and oil companies could have a long wait before making any real money in Venezuela

MW Stock investors and oil companies could have a long wait before making any real money in Venezuela

By Kenneth Rapoza

Infrastructure and economic rebuilding hinges on the U.S. lifting sanctions

Venezuela's new leader Delcy Rodriguez will have to juggle domestic political opposition and the Trump administration's demands.

The world is still trying to decipher what just happened in Venezuela. Nicolás Maduro, leader of the ruling Socialist United Party, is now in a New York prison.

His party, however, still governs, with former Vice President Delcy Rodríguez now Venezuela's new president. She will try to contain the Chavista militants in her own government who have run this once rich country into the ground.

For investors, none of this intrigue matters yet. The only thing that does is sanctions relief - and that remains distant.

This is why the "Maduro trade" faded almost instantly. Chevron $(CVX)$ shares gained a modest 5% on Monday. By Tuesday, most of those gains had evaporated. Smart investors recognize the absence of any legal pathway for Chevron to run a successful business there.

Recall when Syria was ousting Bashar Assad in December 2024, Conoco Philips shares $(COP)$ rose to near all-time-highs. The stock has fallen since - despite the new Syrian government giving the company a gas deal in November, 11 long months after Assad's ouster.

Sanctions relief for Venezuela will only happen once it holds an election that Washington recognizes. There is no time frame for that yet. I suspect we won't see anything until March, at the earliest. Venezuela is a hornet's nest, and investors should assume prolonged limbo until proven otherwise.

If Rodriguez wins, we will have to see what the Trump administration thinks about her government. Polymarket betting currently leans to her remaining Venezuela's leader. If that happens, we can guess Washington's response by seeing what actions Rodriguez takes by executive order to free up business deals and likely unwind part of Venezuela's relationships with China, Russia and surely Iran. Absent those steps, sanctions stay - and markets reset to zero.

If the opposition wins, a different risk emerges. Chavista militant factions remain powerful and violent. No serious investment capital - and certainly no U.S. subsidies to oil companies as Trump has mentioned - will flow while the threat of internal conflict looms.

State oil giant PDVSA - whose defaulted bonds were rising in price in the secondary market this week - issued a statement on Wednesday saying negotiations with the U.S. were similar to existing ones already, so there is nothing new here. Manish Raj, managing director at Velandera Energy Partners, said on Wednesday that "it will be years before Venezuela sees a penny from oil sales and its past-due amounts are repaid."

So what's the Venezuela trade? Oil-price moves (CL.1) attributed to Venezuela will be simple media explanations until sanctions are lifted. No one knows when Venezuelan crude will return to the U.S. and in what volumes - even as Trump said that America will get between 30 million and 50 million barrels of Venezuelan oil.

Trump didn't say when, only that he wanted it done immediately. As in Syria, long-term payoffs could take months to materialize. Market swings attributed to Venezuela by the financial press will prove short-lived. Ultimately, this is more a geopolitical story than a market one.

Read: Here's how much oil Venezuela is producing and exporting, as the country's future hangs in the balance

For now, it seems U.S. Secretary of State Marco Rubio believes Delcy will be subordinate to the U.S. This will anger the Chavistas, which is made up of high-ranking military officials and Marxist revolutionaries - both of the street-muscle variety and in the bureaucracy - and elected officials still fighting the first Cold War on the side of Russian comunistas against U.S.-backed strongmen. They're reliving the 1970s and 1980s. Many of them hate America. Assuming they don't play ball, they will have to be squashed somehow. No one knows if Delcy can temper this crowd, even if she is willing to cut the best deals for Venezuela, the U.S. and herself.

Since the arrest of Maduro, everyone is talking about how this fits perfectly with the Monroe Doctrine 2.0 mentioned in the National Security Strategy the White House released in December.

Venezuela is an important country in the Americas. Better the U.S. have access to or control fossil fuels and minerals than a gangster economy that hates America.

More: What's at stake for investors when Trump meets oil bosses about Venezuela

Outside of oil, China has at least one known joint-venture deal called Arco Minero, but given Venezuela as-is now, I'd say they can have it. Venezuela is crawling with criminals and thugs. The country's mining sector is also largely informal. Contracts are unenforceable and production leaks into black markets. China may lose influence - but it is unlikely to lose much value. In a normalized Venezuela, many of those arrangements would likely be rewritten or abandoned altogether.

For the America First framing, why spend time and money on Middle East wars and Ukraine, when Trump can focus on the foreign-policy intrigue in the Western Hemisphere instead? Washington and many U.S. multinationals have long ignored the region in favor of Asia. That's changing.

Trump says he is "not afraid of boots on the ground" and paired that military option with rhetoric that the U.S. will "run" Venezuela with Delcy. Rubio downplays this, and talks about U.S. leverage and enforcement rather than the day-to-day operations of running a country.

That leverage is being operationalized through what Rubio calls an oil quarantine: seizures and stoppages of Venezuelan crude shipments using existing sanctions architecture and court orders designed to jam exports and force decisions inside Caracas.

Rubio has described this as the core pressure tool: Choke off sanctioned flows until governance terms change, then reopen the lane for Western capital to come in under a new framework.

Delcy faces an ugly incentive structure: hold her party together, contain the revolutionaries and keep the country from sliding into violent factionalism all the while negotiating the least-bad arrangement with an America that has made clear the relationship is asymmetric, said Vladimir Signorelli, head of Bretton Wood Research, a macro investment research firm.

"Taken together, the message to markets is that Washington reserves the right to escalate or de-escalate, depending on compliance and outcomes," Signorelli says. "We don't know which way this will go."

Delcy's actions will determine Trump's actions - and that will determine short-term market moves in oil and the main Venezuelan plays, Chevron being the most obvious.

For now, there is no immediate, miracle offramp to Venezuela's limbo position. The risk is that the ruling party's fracture and the spillover into the streets turns a fast win into a longer, messier commitment. Politically, it will look like a failure for Trump, especially if the Chavistas look strong. For markets, such a scenario will send oil higher - with no date in sight for a Venezuela-U.S. revival.

Kenneth Rapoza is an analyst for the Coalition for a Prosperous America, which represents U.S. producers and workers. He is a former journalist who has reported from Brazil and covered the BRIC economies.

More: The last bearish overhang for crude - Venezuela - is now gone. Why one trader says oil will follow in gold's footsteps.

Plus: These stocks are in play as Trump and China feud over Greenland

-Kenneth Rapoza

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January 10, 2026 12:17 ET (17:17 GMT)

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