ExxonMobil has signed a memorandum of understanding with the Venezuelan government and state-owned Petróleos de Venezuela SA to evaluate potential upstream opportunities, a tentative step toward a country the oil giant left behind nearly two decades ago. The agreement is nonbinding, giving Exxon time to study whether oil production there makes sense without committing to a project.
A Nonbinding First Move
The deal was described as covering “potential upstream opportunities,” according to Bloomberg, which also noted that memorandums of understanding like this one are typically non-binding. Agreements of this kind are commonly used across the industry to grant companies time and sometimes exclusive rights to run tests or complete detailed reviews before deciding whether to commit to a project, as The New York Times reported. Oil projects of this scale can cost billions of dollars and run for many years once underway, per the same account.
Exxon is the biggest U.S. oil company, and its move follows similar agreements that other U.S. oil companies struck earlier in 2026 while weighing investment in Venezuela, the Times reported. Continental Resources, for instance, signed its own memorandum of understanding with PDVSA to develop an area in the Orinoco Belt, according to Fortune.
Woods’s ‘Uninvestable’ Warning
The agreement comes after months of public caution from Exxon chief executive Darren Woods. Speaking at a televised White House meeting hosted by President Donald Trump, Woods said Venezuela was uninvestable, according to the Times. In remarks shared by ExxonMobil, Woods elaborated on what would need to change: “today it's uninvestable. And so significant changes have to be made to those commercial frameworks, the legal system, there has to be durable investment protections, and there has to be a change to the hydrocarbon laws in the country.”
Woods also laid out conditions for re-entry, saying Exxon stood ready to act only under specific circumstances: “With the invitation of the Venezuelan government and with appropriate security guarantees, we are ready to put a team on the ground there.” He noted the company's long and complicated history in the country, recalling that “we first got into Venezuela back in the 1940s. We've had our assets seized there twice.” The Times reported Exxon left Venezuela rather than accept new operating rules the Venezuelan socialist government imposed on foreign oil companies in 2007, and that the company has since sought compensation for the assets it relinquished.
By October, on Exxon's third-quarter earnings call, Woods struck a somewhat different tone, saying the company will ultimately have a role in Venezuela but that substantial changes to historical practices are still required, and that Venezuela still has a way to go, according to the Times. He also said Exxon sees a future need for Venezuela's oil resources, the Times reported.
Why Guyana Raises the Stakes
Exxon's interest in mending ties with Venezuela is sharpened by its position next door in Guyana, where the company operates offshore oil production that has become a major growth engine, according to the Times. Delcy Rodríguez, described by the Times as Nicolás Maduro's successor, is a figure Exxon has a unique interest in building a better relationship with because of that Guyana position.
Exxon's future in Guyana has been clouded by a territorial dispute with Venezuela, the Times reported, and the United Nations' top judicial body is expected to rule on the land border between the two countries by early 2027. Venezuela and Guyana are expected to begin maritime border negotiations only after that ruling comes down, per the same report. Exxon's output capacity in Guyana already exceeds 900,000 barrels per day after crude production began there in 2019, according to Reuters, and the company expects capacity from planned Guyana projects to reach roughly 1.7 million barrels per day by 2030. Reuters also noted that Guyana's Uaru project could eventually push its crude output past that of Venezuela.
Trump's Pressure Campaign and a Symbolic Win
The deal also lands as a symbolic win for Trump, who has pressed U.S. oil companies to invest in Venezuela, according to the Times. Exxon and Caracas are described by the Times as undergoing a broader normalization of relations, a process that took shape after U.S. forces captured Venezuela's leader Nicolás Maduro in January. Oil prices climbed roughly 50 percent since January 2026, largely because of the war with Iran, the Times reported, a conflict that also underscored the value of oil production located far from maritime choke points like the Strait of Hormuz.
Money remains a sore point between Exxon and Caracas. Venezuela now owes more than $13 billion collectively to Exxon and ConocoPhillips for past expropriations, according to court rulings cited by Reuters. Exxon has said any future investment would require stable policies, clear regulations, strong investment protections and competitive returns, the Times reported.
Venezuela's Legal Overhaul and Chevron's Head Start
Venezuela overhauled legislation in January to attract foreign oil companies, the Times reported, and the country's National Assembly says a partial reform of the Organic Hydrocarbons Law has since been approved unanimously in its second reading. Under the reform, primary hydrocarbon activities may be carried out by the national executive, state-controlled mixed companies, or private companies domiciled in Venezuela operating under specific contracts with state companies, according to the Venezuela National Assembly. The Assembly says disputes may be resolved through competent courts or arbitration, and that the law provides for royalties of up to 30% alongside an Integrated Hydrocarbons Tax of up to 15% of gross income.
Chevron offers a preview of what deeper U.S. involvement in Venezuela can look like. It is the only U.S. oil major currently active there, operating through joint ventures with PDVSA, and announced a $7 billion investment to expand its Venezuelan production over five years, according to CNBC. CNBC reported Chevron's Venezuelan output was about 280,000 barrels per day at the time, while a separate account of the company's third-quarter results said production was on track to reach roughly 300,000 barrels per day gross by year-end, up 20% over 12 months, according to Yahoo Finance. Chevron has reportedly laid out plans to roughly double that figure to about 600,000 barrels per day by 2031, per Yahoo Finance. Fortune separately reported that Venezuela's overall oil output rose from less than 1 million barrels per day to more than 1.2 million barrels per day in October.
For now, Exxon's own next steps in Venezuela remain undefined. The memorandum gives the company room to study the ground before deciding whether, and how, to come back a third time.
