weighted score 6.6 · five dimensions
Geopolitical & Concentration Risk
Venezuela
Geopolitical conflict, supplier concentration, climate exposure, sanctions risk and policy continuity intelligence for Venezuela-origin supply chains.
Geopolitical conflict
6
US military operation January 2026 removed Maduro. Political situation unstable. Guyana territorial dispute unresolved. Regional refugee crisis affecting neighbouring countries.
Supplier concentration
7
World's largest proven oil reserves but production collapsed to ~1M bpd. Heavy crude requires specialised refining. Gold and mineral deposits exist but under illegal artisanal mining control.
Climate & physical risk
4
Coastal flooding and landslide risk. Infrastructure degradation magnifies climate vulnerability. Power grid failures endemic. PdVSA infrastructure in critical disrepair.
Sanctions exposure
7
Comprehensive US OFAC sanctions on PdVSA and government. EU sanctions on individuals and arms. All sanctions remain post-military operation. Selective US oil purchases under military framework.
Policy continuity & property rights
9
GDP contracted 80% since 2013. 475% inflation. Property rights non-functional. Acting president lacks consolidated control. Constitutional legitimacy contested. TI CPI 2025: 10/100.
Geopolitical Exposure
Geopolitical Exposure
- Regime change
- Maduro removed by US military operation January 2026. Acting president Delcy Rodriguez. Political situation remains highly unstable with contested legitimacy. International recognition fragmented.
- US military presence
- US military operation ongoing since January 2026. Security situation fluid. Oil infrastructure under partial US operational control. Long-term political settlement unclear.
- Regional instability
- Colombia border tensions. Guyana territorial dispute (Essequibo) unresolved. 8 million Venezuelan refugees across Latin America creating regional political pressures.
- Buyer implication
- Political instability and ongoing military operations make Venezuela an extremely high-risk sourcing origin. Sanctions remain in force. Any commercial engagement requires extensive legal review.
Supply Chain Concentration
Supply Chain Concentration
- Oil reserves
- Venezuela holds the world's largest proven oil reserves (~300 billion barrels). However, production collapsed from 3M+ bpd pre-crisis to ~1M bpd. PdVSA infrastructure in critical disrepair. Heavy crude requires specialised refining.
- Mineral resources
- Gold, diamonds, coltan, bauxite, and iron ore deposits in the Arco Minero region. Artisanal and illegal mining dominates. No functioning industrial-scale mining operations with credible governance.
- Agricultural collapse
- Once-productive agricultural sector has collapsed. Coffee, cocoa, and cattle production at fraction of historical levels. Food imports now necessary for basic consumption.
- Substitution
- Venezuelan oil is heavy sour crude requiring specialised refinery configurations (US Gulf Coast). Alternative heavy crude sources include Canada (oil sands) and Middle East producers. Mineral resources have alternative sources globally.
Climate & Physical Risk
Climate & Physical Risk
- Flooding & landslides
- Northern coastal mountains prone to devastating landslides and flooding. Vargas tragedy (1999) killed thousands. Infrastructure vulnerability to extreme rainfall events has worsened with maintenance collapse.
- Caribbean hurricane exposure
- Northern coast exposed to Caribbean hurricane season (June-November). While Venezuela is south of the primary hurricane track, tropical storm impacts affect coastal infrastructure.
- Infrastructure degradation
- Power grid failures endemic — nationwide blackouts in 2019 lasted days. Water treatment systems non-functional in many areas. Road and bridge infrastructure deteriorating without maintenance investment.
- Oil infrastructure risk
- PdVSA refinery and pipeline infrastructure in critical disrepair. Amuay refinery explosion (2012) killed 48. Environmental contamination from oil operations widespread in Lake Maracaibo region.
Sanctions & Policy Continuity
Sanctions & Policy Continuity
- US sanctions
- Comprehensive OFAC sanctions on PdVSA, government officials, gold sector, and financial transactions. All sanctions remain in force post-January 2026 military operation. Selective US oil purchases began under military framework.
- EU sanctions
- EU sanctions targeting individuals, arms embargo, and equipment for internal repression. Less comprehensive than US sanctions but restrict key commercial transactions and financial flows.
- Policy uncertainty
- Post-Maduro political settlement undefined. Acting president lacks consolidated control. Constitutional legitimacy contested. Property rights and contract enforcement non-functional. 475% inflation in 2025.
- Economic collapse
- GDP contracted 80% since 2013. Hyperinflation has destroyed the bolivar. Dollarisation widespread but informal. Banking system non-functional for international transactions. Population ~28M (down from ~30M pre-crisis).