Guyana is among a number of oil-producing countries in South America named in an article published in last Wednesday’s edition of the Nepal Times and authored by Inter Press Service development, environment and human rights journalist, Humberto Marquez, that could benefit from new “business opportunities for the oil-producing countries of the developing South” arising out of the “oil and gas supply crisis” spawned by Russia’s invasion of the Ukraine.
“The countries with the most positive economic effects are the net exporters that depend on hydrocarbon revenues for a large portion of their budget, economic activity and foreign exchange,” Marquez
quotes Head of Energy with the Washington-based think-tank, Inter-American Dialogue, Nate Graham, as saying.
Graham reportedly names “countries such as Colombia, Ecuador and Venezuela” as countries that are likely to benefit from a move by the west to reduce its dependence on Russian oil imports. The article also names Guyana as a likely beneficiary country given its current oil recovery returns from the Atlantic of “some 110,000 barrels per day (b/d) in 2021” and expected 20,000 b/d within a year. By contrast the assessment states that “countries in the Caribbean, Central America and Chile, which import oil and gas, will suffer the opposite effect.”
The anticipated surge in fortunes for oil-producing countries in the hemisphere is attributed to the post-February outbreak of Russian hostilities against Ukraine and the attendant “abrupt withdrawal, in markets with fragile balances, of some three million (159-litre) barrels per day of crude oil from Russia, and the decision of a large part of Europe to cancel gas imports from Russia and look for other suppliers.”
The article quotes Venezuelan oil geopolitics expert, Kenneth Ramirez, as saying that while oil and gas producers in the South “are enjoying extraordinary revenues… those who are not producers have higher energy bills and are suffering from higher prices for food, of which Russia and Ukraine are major suppliers.”
The article identifies Guyana as “one of the first to benefit… having extracted from the Atlantic Ocean some 110,000 barrels per day in 2021 and expects to add another 220,000 within a year… to achieve this,” adding, “the US oil giant Exxon, with a century and a half of experience in the industry, accelerated its decision to invest another 10 billion dollars in Guyana.”
And according to the article, Guyana’s neighbour and aspiring oil exporter, Suriname, is also hoping for new investments in an oil and gas sector whose blossoming is believed to be imminent.
At the centre of the unfolding oil and gas ‘theatre’, Marquez writes, is the likelihood that the conflict in Ukraine could well realise “a new contact between the United States and Venezuela, following a protracted and fierce ‘conflict’ between Washington and Caracas which saw US action to block Venezuelan oil exports bring the country’s economy to its knees.”
Much of that could change, however, given Venezuela’s enormous oil reserves of mostly heavy crude. Contextually, Washington’s recent high-level engagements with Caracas are regarded in some quarters as a sign that it considers the application of pressure on Russia to end its campaign in Ukraine as being more important than persisting with pressure against the Maduro administration at this time.
It is not believed that President Maduro is likely to look a gift horse in the mouth.
