U.S. presidential candidate Donald Trump’s announcement of a potential military and diplomatic intervention in Venezuela has intensified regional tensions, particularly over the contested Essequibo region claimed by both Venezuela and Guyana. The move raises alarms about the security of Guyana’s rapidly expanding oil production.
- Guyana’s oil production projected to reach 1.2 million barrels per day by 2027
- Over 16,000 Venezuelan troops deployed near the Essequibo border in 2025
- ExxonMobil holds 45% stake in Guyana’s key Stabroek Block
- Guyanese sovereign bond yields rose 180 basis points in two weeks
- Guyana’s GDP grew by 40% in 2024, driven by oil exports
- Guyana launched a $300 million defense modernization program in January 2026
Donald Trump’s proposed intervention in Venezuela, unveiled in January 2026, has triggered diplomatic and market reactions across South America, especially in Guyana, where oil output is projected to exceed 1.2 million barrels per day by 2027. The Essequibo region, which covers more than half of Guyana’s territory and contains vast oil reserves, remains a flashpoint between Caracas and Georgetown. Venezuela’s president, Nicolás Maduro, has escalated rhetoric and military presence along the border, with over 16,000 troops deployed near the disputed area in 2025. The strategic stakes are high: Guyana’s offshore oil sector, led by ExxonMobil with a 45% stake in the Stabroek Block, has attracted over $25 billion in foreign investment since 2017. Production from the Liza and Payara fields alone contributed $12 billion in export revenues in 2024, accounting for nearly 40% of Guyana’s GDP. Any disruption to operations could impact global energy markets and trigger capital flight from Guyanese assets. Global markets responded swiftly, with Guyana’s sovereign bond yields rising 180 basis points in two weeks and the Guyanese dollar depreciating 12% against the U.S. dollar. Major energy firms, including CNOOC and Hess Corporation, have begun contingency planning, with some diverting shipments through safer maritime routes. Regional allies, including Brazil and the United States, have called for de-escalation, but the U.S. Department of State has signaled support for Guyana’s territorial integrity under the 1899 Paris Arbitral Award. The situation underscores the fragility of energy-driven economic growth in small states, where geopolitical instability can rapidly undermine investment returns. Guyana’s government has announced a $300 million defense modernization program and is seeking expanded security cooperation with NATO partners.