The Misunderstood Wealth: Heavy Crude and Venezuela’s Petrochemical Future

When analyzing the global energy market, we often fall into the temptation of simplifying the numbers. We read headlines about Venezuela’s reserves and stop at the macro figure: 300 billion barrels of proven reserves — the largest accumulation on the planet, surpassing even giants like Saudi Arabia.

However, as I recently mentioned in an interview with El Nacional https://www.elnacional.com/2025/05/el-petroleo-crudo-pesado-en-venezuela-pilar-energetico-y-desafio-economico/ the technical reality is far more nuanced and presents a challenge that, paradoxically, is our greatest long-term opportunity: of that immense wealth, roughly 269 billion barrels correspond to heavy and extra-heavy crude.

The challenge of viscosity

For those of us coming from field engineering who have managed operations from Monagas, Venezuela, to the Caspian Sea, we know not all oil is the same. Crude from the Orinoco Belt (FPO) has an API gravity of less than 12 degrees. It’s dense, viscous, and flows with difficulty.

Extracting and processing it is no simple task; it requires steam injection, diluents, and complex — and costly — refining infrastructure to deal with sulfur and metals. This explains why, in the short term, conventional light crude fields remain attractive for their immediate profitability and ease of transport.

The petrochemical advantage: Where there are no substitutes

But this is where we must broaden our strategic vision. We live in an era of energy transition. It is true that the demand for oil to generate electricity will decline in favor of solar or wind energy, and that electric vehicles will reduce the need for gasoline.

However, there is one sector where hydrocarbons have no viable substitute in sight: petrochemicals.

While Saudi Arabia and the United States have lighter crudes ideal for fuels, Venezuela’s heavy crude is an extraordinary feedstock for the global chemical industry. It is no coincidence that giants like Reliance — which operates the world’s largest refinery in India — have maintained a historic and strategic interest in our heavy crudes.

A long-term perspective

The Orinoco Oil Belt, with its 55,000 km² and 15% of the world’s reserves, is a global energy security asset. As light crude reserves worldwide are depleted at an accelerated pace, our heavy reserves guarantee supply for decades to come.

The challenge, as I often tell investors and colleagues, is not the lack of resources but the lack of capital and technology. The U.S. Department of Energy summarizes it well: extracting this oil is technically straightforward with the right systems, but costly to produce without the proper infrastructure.

Conclusion

Venezuela holds a unique competitive advantage. Turning that geological advantage into economic prosperity requires seeing oil not merely as fuel to burn, but as the essential raw material for the materials of the future. The energy transition does not mean the end of oil — it means the evolution of its use. And that is where Venezuela’s heavy crude has its best chapter yet to be written.

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By: Jorge Miroslav Jara Salas, Global Energy Expert | President of Magnaccord Group SL

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Would you like to dive deeper into the technical differences and investment opportunities in the region? I invite you to read the full article with my statements in El Nacional https://www.elnacional.com/2025/05/el-petroleo-crudo-pesado-en-venezuela-pilar-energetico-y-desafio-economico/