GULF COAST OIL REFINERIES

Object Zero

Jan 3, 2026 

 

 

The real winners of the development of Venezuela (in addition to the Venezuelan population) are the gulf cost refineries. 

These oil refineries are mostly heavy oil refineries, which was a bit of misfit for the fracking boom as shale produced a lot of light oil.

The result was that the US would export much of its own light shale oil, and import a lot of heavier oil that suited older US refineries. 

So whilst the US was a net neutral oil importer on paper, the reality was that it still needed to import a lot of heavy oil. That’s probably going to resolve over the next 5 years.

Interestingly, Venezuela is all heavy oil and the development of Venezuela’s oil reserves secures the future of these refineries for maybe the next 50 years or so.

Of all the companies here VLO probably the most directly exposed, but it’s quite likely that a lot of capital flows into Texas, as it’s increasingly able to export more oil overseas whilst also importing oil from more secure sea lanes.

Also the companies developing Venezuela are also by and large HQ in Texas too. So Texas probably going to do very well out of developing Venezuela and Venezuela also quite likely to become a wealthy petrostate.

The media shock of capturing Maduro so swiftly is quickly going to be replaced with the realisation that this is a huge energy boom in the making.

Lots of capex is going to be directed this way, and the US supermajors have been building capital reserves for the past year.