The American administration reiterated its willingness to militarily support Guyana in the event of escalation related to the Essequibo territorial dispute with Venezuela. This stance comes as the Caribbean country emerges as one of the fastest-growing oil hubs globally, with production already exceeding 630,000 barrels per day (b/d) and a confirmed trajectory toward 1.5 million b/d by 2029.
Rapid growth of a strategic oil hub
In just five years, Guyana has become the third-largest oil producer in South America, behind Brazil and Venezuela. The offshore Stabroek block, operated by ExxonMobil with stakes held by Hess (now Chevron) and China National Offshore Oil Corporation (CNOOC), has enabled this transformation. The fourth floating production storage and offloading unit (FPSO), ONE GUYANA, is expected by the end of the year, adding over 250,000 b/d in capacity.
The extracted volumes are mainly shipped to refineries in Asia, Europe and the U.S. Gulf Coast. This oil is particularly valued for its quality (light and low-sulphur) and its flexibility in non-OPEC benchmark blends. In 2024, the oil sector generated more than $2.5bn in revenue for the Guyanese state, representing a significant share of national GDP.
U.S. security guarantee and military deterrence
The U.S. ambassador in Georgetown confirmed that Washington would defend Guyana militarily in case of any incursion or escalation from Venezuela. This statement followed the entry of a Venezuelan naval vessel into Guyana’s exclusive economic zone (EEZ) near the Stabroek oil blocks, prompting a coordinated diplomatic and security response.
The United States has since maintained an increased naval presence in the Caribbean, including an aircraft carrier and multiple support vessels. This deterrence aligns with a broader operational context involving potential U.S. actions against narco-criminal networks operating inside Venezuelan territory, heightening the risk of indirect retaliation by Caracas on Guyanese offshore installations.
A legal dispute under the authority of the ICJ
The territorial dispute over the Essequibo region, which accounts for about two-thirds of Guyana’s landmass, is currently under review by the International Court of Justice (ICJ). In May 2025, the Court barred Venezuela from organising elections in the area, after Caracas had already held a referendum in favour of annexation and enacted legislation establishing a state called “Guayana Esequiba”.
The final ruling, expected between 2025 and 2026, could strengthen the legal framework of oil contracts. However, a partial or ambiguous ruling may leave some marginal offshore zones open to interpretation or future disputes.
Impact on sector companies
For ExxonMobil and Chevron, the Stabroek block is a key upstream asset. U.S. military involvement in the area reduces perceived political risk, easing access to financing for upcoming infrastructure projects. Chevron, gradually withdrawing from Venezuela, is redirecting investments toward a legally stable and militarily protected environment.
Other operators such as TotalEnergies, QatarEnergy and Petronas, active on new offshore blocks, also benefit indirectly from this security guarantee. However, a prolonged escalation with Caracas could temporarily increase costs for insurance, logistics or security on certain maritime routes.
