Texas Refineries Eye Venezuelan Oil as Mexico Exports Decline

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As Mexico reduces its heavy crude oil exports to the U.S. Gulf Coast, Texas refineries are eyeing Venezuelan oil as a potential replacement. The Trump administration's efforts to revive Venezuela's oil industry and ease sanctions have created an opportunity for more Venezuelan crude to flow into U.S. refineries, especially as Mexico focuses on building its own refining capacity. Refiners like Valero Energy have already increased their Venezuelan oil purchases, and analysts expect more Venezuelan barrels to reach the Gulf Coast in the coming years.

Why it matters

The shift in heavy crude oil sources is significant for the U.S. Gulf Coast refining industry, which has long relied on Latin American heavy crude from Mexico and Venezuela. As those supplies decline, refiners must find new sources to feed their facilities designed to process heavier, higher-sulfur crudes. The increased availability of Venezuelan oil could help offset the loss of Mexican imports, but it also raises questions about the long-term reliability of Venezuela's oil production and the political risks involved.

The details

Texas oil refiners could soon have a stronger appetite for Venezuelan oil thanks to decreasing crude imports from Mexico as the Trump administration seeks to open Venezuela's energy sector to U.S. companies. Refiners along the U.S. Gulf Coast are among the world's largest buyers of heavy crude oil, and for years their most prolific sources have been Canada, Mexico and Venezuela. But after the Trump administration captured Venezuelan President Nicolás Maduro, Gulf Coast refiners are eyeing the possibility of increased Venezuelan oil imports. Valero Energy has already ramped up its Venezuelan oil purchases, and Chevron, the only U.S. company currently authorized to operate in Venezuela, is reportedly capable of increasing production by 50% within the next two years. Meanwhile, Mexico's new Dos Bocas refinery is expected to decrease the country's Maya crude exports to the U.S. Gulf Coast by 200,000 to 250,000 barrels per day, creating an opening for Venezuelan oil.

• In 2004, Mexico's Cantarell offshore field reached peak production of 2.14 million barrels per day and has since declined to 115,000 barrels per day.
• In 1997, Venezuela recorded peak oil production of nearly 3.5 million barrels per day, but production volumes have since plummeted to under 1 million barrels per day under the Maduro government.
• In 2014, the completion of the Keystone pipeline's Gulf Coast extension allowed refiners to fill a portion of the declining Latin American supply with Canadian crude.
• By November 2025, Mexico's new Dos Bocas refinery was running at 60% of its 340,000 barrels per day capacity, and is expected to reach full capacity this year.
• In January 2026, Valero Energy said Venezuelan crude will make up 'a large part of our heavy diet as we move into February and March.'

What they’re saying

What’s next

The Trump administration is expected to continue easing sanctions on Venezuela's oil industry, which could allow more Venezuelan crude to flow to U.S. Gulf Coast refineries in the coming years.