New Delhi: Venezuela has the largest proven oil reserves in the world, but it is still unable to produce enough oil. A new report explains that many long-term problems have stopped the country from using its huge oil wealth properly.
According to the report by PL Capital, Venezuela’s oil sector has suffered due to poor management, lack of investment, political control, corruption, sanctions, and shortage of technical expertise. Even though the country has massive oil reserves, these issues have badly hurt production.
Venezuela holds about 303.8 billion barrels of proven oil reserves, making it the largest in the world. Saudi Arabia comes second with 297.5 billion barrels. Other major countries like Canada, Iran, and Iraq are far behind. In comparison, the United States, which is the world’s largest oil consumer, has much smaller reserves.
Despite this advantage, Venezuela’s oil production remains very low. In November 2025, the country produced only about 1 million barrels per day. This is far less than the United States, which produces 13.7 million barrels per day, and Saudi Arabia, which produces 9.7 million barrels per day. Venezuela’s output is also just one-third of what it produced ten years ago.
Historically, Venezuela was once a strong oil producer. In 1970, it produced nearly 3.7 million barrels per day, similar to Saudi Arabia at that time. However, years of neglect and mismanagement have caused a steady decline.
The report also mentions recent political developments involving President Nicolas Maduro. After being elected in 2013, Maduro has largely ruled by decree. Recent actions by the United States against Venezuela could create short-term uncertainty in global oil markets.
Experts say there is no quick solution to fix Venezuela’s oil production. Even if conditions improve, it could take 3 to 6 months before any real increase in output is seen.
In the short term, global oil prices may rise slightly due to uncertainty, depending on how countries like Russia and China react. With Brent crude around $60 per barrel, the report believes Indian upstream oil companies like ONGC and Oil India could benefit. Indian oil marketing companies (OMCs) may also stay profitable due to low oil prices.
However, analysts warn that a possible increase in fuel taxes could pressure OMCs, especially given their high current valuations.
