Front Burner Canada’s Venezuelan oil problem
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Jan 6, 2026 Evan Dyer, a senior reporter at CBC with a wealth of experience in Canadian foreign policy and Latin America, discusses the implications of Venezuelan oil on Canada. He highlights Venezuela's vast reserves and the potential shift in geopolitical balance as U.S. access raises concerns for Canadian trade. Dyer explains the challenges of reviving Venezuela’s oil production, the cautious stance of oil firms, and how this situation could impact Canada’s negotiating power with the U.S. Additionally, he critiques the U.S. approach to prioritizing stability over democracy.
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Venezuela's Oil Is a Strategic Threat
- Venezuela holds the world's largest proven oil reserves and its crude is chemically similar to Canadian heavy oil.
- Its proximity to Gulf Coast refineries and ease of shipping make it a potential competitor to Canadian exports.
How Canadian Oil Replaced Venezuelan Barrels
- Canadian heavy oil displaced Venezuelan barrels after Chávez-era decline and pipeline flows reversed north-to-south.
- Refineries were refitted to process Canadian crude, creating infrastructure lock-in that hinders a quick Venezuelan comeback.
Production Collapse And Shadow Shipments
- Venezuelan production collapsed from ~3.5 million to about 1 million bpd amid mismanagement and damaged infrastructure.
- Many shipments move via a shadow fleet under flags of convenience because of sanctions and maintenance failures.