While concerns are being raised about how the U.S. ousting of Venezuelan leader Nicolas Maduro could affect Canadian oil markets, industry experts say the outcome will not be immediate.
US President Donald Trump has shown interest in reforming Venezuela’s oil sector, but on Sunday, Secretary of State Marco Rubio said the US will not dominate the South American country and will continue with “oil isolation,” raising questions about what’s next for the sector.
“As for returning permanently, I see that will be very difficult,” said Luis Virla, who worked for the Venezuelan oil industry. “It will take many years and a lot of money to restore the energy infrastructure and the energy sector to the way it was, even in the 1990s.”
Aside from the work needed to bring Venezuela’s sector up to speed, news of US operations in Venezuela weighed on Canadian energy stocks on Monday.
Cenovus Energy Inc. and Canadian Natural Resources Ltd. each fell about 5 percent and Suncor Energy Inc. down 1.4 percent. Enbridge Inc., which operates a large network of cross-border oil pipelines it plans to expand, and South Bow Corp., whose Keystone system ships to the US, each fell about 3 percent.
Venezuela produced about 1.1 million barrels of oil per day in November 2025 and exported 950,000 barrels, but US measures, including its embargo, reduced it to about 500,000 barrels per day in December, according to preliminary estimates based on shipping.
Actual shipments to US not as big an impact as price bump: RBC
Shaz Merwat, head of energy policy at RBC Thought Leadership, said in an interview Monday that Canadian oil should have no difficulty “finding a home” in the US, noting that 4 to 4.2 million barrels per day are sent to the US by pipeline.
Most of that is shipped to the US Midwest – about 2.8 to 2.9 million barrels per day.
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“That’s not the refinery where the Venezuelan waste ends up,” Merwat said. “Venezuela’s greenness, in fact, all goes to the US Gulf Coast.”
The US Gulf Coast and West Coast each receive about 400,000 to 500,000 per day from Canada.
“There’s a lot of attention around the Gulf refiners that are made for Venezuelan oil and they’ve switched to Canadian oil for refining, whether they’re going to look at or prioritize getting Venezuelan oil back,” said Virla, who now works as a professor at the University of Calgary.
Merwat added that price may be more of a factor than where US oil can be exported.
“Where there’s a concern is obviously a function of prices because now US refineries have more availability, more options as to where they get their waste and it gives them increased bargaining power and that can increase the difference to Canada in our heavy oil,” he said.
Canada must continue to diversify
Heather Exner-Pirot, director of energy and natural resources and the environment at the MacDonald-Laurier Institute, said that she is not too worried about competition for Canadian oil from Venezuela at this time, because competition already exists from the US, Brazil, Mexico and OPEC, among others.
The best thing Canada can do is keep doing what it is doing, according to Exner-Pirot.
“At the end of the day, the only people buying bulk oil are the refineries that accept bulk oil and most of them are in the United States and Asia,” he said. “If we’re going to split our exports, it’s going to be the Asian refineries that want our biggest oil.”
It may take years for Venezuela to return to previous production levels, Virla said, while Canada has a chance.
“There’s very little power that Canada as a supply-side economy or Alberta’s economy would have, depending on the single market,” he said. “I would encourage the Canadian industry to be bold and say, ‘Okay, how do we focus on diversifying our customer base, how do we add other types of energy products to make ourselves less exposed to these big changes in the market?'”
In a statement sent to Global News, Alberta Premier Danielle Smith said events in Venezuela “underscore” the need to accelerate pipeline production to diversify oil-exporting markets.
“Alberta supports building pipelines in all directions to support our product and we look forward to continuing to work with our provincial and federal partners to advance these projects,” Smith wrote.
— via files from Reuters, The Canadian Press and The Associated Press
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