Houston Giants Diverge on Venezuela as Profits Slump: Chevron Bets Big, Exxon Stays Out
HOUSTON – The divergent paths of America's oil titans were on full display this week as Chevron and Exxon Mobil reported sharply lower 2025 profits. While both cited weak crude prices, their strategic visions for Venezuela – home to the world's largest oil reserves – could not be more different, underscoring a deep industry divide on navigating high-stakes political landscapes.
Chevron CEO Mike Wirth told investors the company is poised to boost its current Venezuelan output by up to 50% over the next two years, signaling a bullish bet on the country's future. "Assuming it competes, you should expect to see us running more Venezuelan crude in our system over time," Wirth said, noting readiness to increase refining by over 100,000 barrels per day, likely benefiting Gulf Coast and California facilities.
In stark contrast, Exxon Mobil's official 2030 roadmap makes no mention of Venezuela. CEO Darren Woods pointed to the nation's "high costs of production and... economic and legal instability," stating that a move toward "a more representative democracy" would be a prerequisite for any major commitment. Exxon and others are still seeking billions in compensation from Venezuela's 2007 industry nationalization.
The backdrop is a painful year for oil majors. Exxon's annual earnings fell to $28.8 billion from $33.7 billion in 2024, while Chevron's profit dropped 30% to $12.3 billion. This slump comes despite record production from key assets like the Permian Basin and offshore Guyana, highlighting how price volatility continues to squeeze margins.
Chevron operates in Venezuela under a special U.S. Treasury license, maintaining a baseline presence. Exxon, however, has completely withdrawn. The Trump administration's push for a $100 billion U.S. industry investment in Venezuelan fields post the January 3rd ouster of Nicolás Maduro has thus met a mixed reception. Both companies acknowledged the administration's steps but emphasized the long road ahead.
Exxon is doubling down on technological prowess in its core regions. Woods highlighted a 40-year production record in 2025, averaging over 4.7 million barrels per day, and expressed confidence that supercomputing and new drilling tech could unlock more from mature fields like the Permian. "The recovery rate... is still, in my mind, way too low," he said.
The market reaction was muted but telling: Chevron shares edged up 1.5% by midday Friday, while Exxon's dipped 1.4%.
Analyst & Investor Reactions:
"Chevron's calculated gamble reflects a long-game strategy to secure heavy crude for its refining network at a potential discount," said David Chen, energy strategist at Gulf Coast Capital. "It's a complex logistical and political hedge, but the upside is substantial if stability gradually returns."
Maria Rodriguez, portfolio manager at Horizon Investments, offered a more cautious take: "Exxon's discipline is prudent. Venezuela is a bottomless pit of risk right now. Shareholders should be relieved they're prioritizing shareholder returns and low-break-even projects in Guyana and the Permian over a geopolitical quagmire."
The sharpest critique came from Leo Brandt, a veteran geologist and outspoken industry commentator: "This is a classic case of short-termism versus paralysis. Chevron is playing with fire, cozying up to a regime change project that could backfire spectacularly. And Exxon? They're hiding behind the 'instability' excuse while sitting on billions in unpaid claims. It's hypocrisy. Both are failing to articulate a coherent energy transition strategy, and these Venezuela theatrics are just a distraction from that core failure."
James Foley, a former diplomat now with the Global Energy Security Initiative, provided context: "The split isn't just about risk appetite. It's about refinery configuration and legacy assets. Chevron's system is built for heavier crudes. Exxon's future portfolio is lighter. This decision is as much about engineering as it is about geopolitics."