Hydrocarbons hold firm as Latin America navigates energy shifts and political headwinds

Shade in red: Countries with active oil and gas sectors in 2025. Source: www.mapchart.net

As 2025 ends, Latin America’s oil and gas sector reflects a region developing on uneven terrain. Global oil output topped 100 million barrels per day this year, with Latin America accounting for roughly 10% of the total. Global energy markets have been shaped by geopolitical realignments, renewed U.S. sanctions, and the accelerating energy transition. While oil prices remained volatile—driven by Middle East tensions and constrained by slowing global demand—Latin America’s producers responded with a mix of strength, adjustment, and pullback. The result: a mix of progress, setbacks, and changing plans across the region.

Guyana: The New Powerhouse

Guyana continued in 2025 as Latin America’s top growth play. Oil production passed 600,000 barrels per day, thanks to ExxonMobil’s fast-paced offshore drilling, with an average estimated production in November of 700,000–725,000 bpd (+3% over 2024). The government’s licensing rounds drew strong international interest, and new floating production units (FPSOs) are expected to increase output even more in 2026. With clear rules and steady investment, Guyana is becoming a key oil supplier outside of OPEC. Recent changes to tax terms and infrastructure plans show the country isn’t just enjoying a boom—it’s in it for the long game.

Brazil: Solid Growth and Clear Direction

Brazil maintained the lead as the region’s biggest oil producer, adding over 200,000 barrels per day this year, with an estimated average production in November of 4,000,000+ bpd (+10.4% over 2024). Petrobras focused on its deepwater pre-salt fields, which continue to deliver strong results. Even with political changes, the rules for oil investment stayed consistent, and new auctions attracted plenty of interest. Brazil also made progress on natural gas, expanding pipelines and LNG export capacity. The country’s updated energy plan supports both oil and renewables, aiming for a balanced transition.

Argentina: Gas Gains Despite Economic Struggles

Argentina’s energy sector had a mixed year, with oil production averaging 860,000 barrels per day (+15.8% over 2024). But natural gas was the star. Vaca Muerta kept growing, with steady increases in gas production and a 16% increase year-over-year. Overall gas production exceeded 145 million cubic meters per day, reflecting an increase of 4.3% in 2025. Despite inflation and currency problems, the government managed to attract investment and move forward with key pipeline projects like the Néstor Kirchner line. New subsidies and export incentives helped keep things moving, but economic and political uncertainty remains a major challenge heading into 2026.

Mexico: Little Movement, Many Questions

Mexico’s oil and gas output stayed flat in 2025. Oil production averaged 1,600,000 bpd (−1.2% over 2024). Pemex continued to be a disaster—a pile of debt, operational problems, and an unclear position on private investment under the new government of President Claudia Sheinbaum. With no new licensing rounds and unclear regulations, exploration has slowed. While there’s talk of moving toward cleaner energy, there’s still no clear plan, and the sector is waiting for positive signals in 2026.

Ecuador: Falling Output, Unclear Future

Ecuador’s oil production increased in 2025, averaging 468,000 bpd (+2.2% from 2024), despite force majeures from 2024 that extended into July. Output rebounded by 216% from July to August, recovering from earlier disruptions amid challenges from aging infrastructure and social unrest. The government tried to bring in new investment with updated contracts, but results were limited. Political instability and protests against drilling in the Amazon added more pressure. With elections coming and budget problems growing, energy policy remained uncertain. Plans for 2026 include possible privatizations and a new push for offshore drilling, but investors are cautious.

Peru: Slow Progress, LNG Steady

Peru’s oil and gas sector stayed quiet in 2025, with oil production averaging 46,000 bpd (−6.1% from 2024). Exploration was limited, and older fields kept declining. On the positive side, the country’s LNG export facilities continued to run well. The government introduced new rules and incentives to attract offshore drilling, but progress has been slow. The political situation and local opposition to resource projects are still major roadblocks.

Venezuela: Sanctions Return, Limited Options

Venezuela’s oil production increased to 1,200,000 bpd in 2025, up 10% from 2024. The country saw a short-lived boost in early 2025 when Chevron resumed some operations, but things slowed again after the U.S. reimposed sanctions later in the year. PDVSA launched new oil blends like “Blend 22” to try to get around restrictions and keep exports going. Still, old equipment and a lack of outside investment are holding back production. The government is turning to barter deals and partnerships with countries outside the West, but without a change in political regime, a recovery will not prosper.

Trinidad and Tobago: Gas Output, Modest Gain

T&T produced about 2.9 billion cubic feet per day (bcf/d) of natural gas in 2025, up from 2.6 bcf/d in 2024—an increase of 11.5%. The gain came from better use of existing plants and small adjustments in mature fields, driven by the partial ramp-up of new offshore developments like the Calypso Offshore projects, which are still in the planning stage. Even with the increase, production stayed well below the country’s peak of over 4.0 bcf/d. Trinidad remains a major exporter of LNG, methanol, and ammonia, supported by long-standing infrastructure and processing capacity.

Suriname Keeps Exploring, but Production Still Years Away

In 2025, Suriname had no commercial gas production but remained active in offshore exploration, particularly in Blocks 52 and 58. Petronas drilled three new wells—Kiskadee-1, Roystonea-2, and Caiman-1—building on earlier discoveries like Sloanea and Fusaea, while TotalEnergies and APA Corp. continued appraisal work at Krabdagu and Sapakara South. Although no final investment decisions were made, the government advanced plans for gas-to-shore infrastructure and LNG exports, aiming for first production later in the decade.

Latin America’s Oil & Gas Output in 2025

Legend:

• bpd = barrels per day
• bcf/d = billion cubic feet per day
• “Not applicable” = no oil production reported
• “No commercial production” = exploration ongoing, but no output
• Gas volumes in cubic meters are daily averages
• All figures are 2025 estimates unless otherwise noted

• Regional Trends: Offshore Drilling, More Gas, and Climate Pressur

Across Latin America, a few big themes stood out in 2025. Offshore oil projects are booming, especially in Brazil and Guyana, where billions of dollars are flowing into deepwater drilling. Natural gas is also gaining ground, with Argentina and Trinidad and Tobago increasing output, while Suriname advanced offshore exploration without yet reaching production. Governments across the region remain under pressure to cut emissions and shift toward cleaner energy, all while navigating protests, elections, and global uncertainty.

Despite growing global pressure to accelerate the energy transition, most Latin American countries are not stepping away from oil and gas. Investment in hydrocarbons remains strong, driven by fiscal needs and energy security priorities. The exception is Colombia, which has paused new licensing in line with its climate agenda. Elsewhere, the transition is acknowledged—but has yet to shift the region’s energy strategy.

What to Watch in 2026

Several key developments will shape the region’s energy future next year:

• Guyana’s next licensing round and new offshore platforms

• Brazil’s oil auctions and Petrobras’ post-election strategy

 • Mexico’s stance on private investment and energy reform

 • Argentina’s gas export plans and economic stability

 • Ecuador and Peru’s efforts to attract new drilling

• Venezuela’s ability to manage its political situation to attract investment and boost output

• Suriname’s offshore decisions and potential final investment moves

• Trinidad and Tobago’s efforts to sustain gas recovery and secure new upstream projects

Note: All oil production figures are based on secondary source data reported by OPEC, unless otherwise specified.

Sources: OPEC, Petroguía, Trading Economics, Kaieteur News, Guyana Chronicle, Guyana Standard, ExxonMobil, Upstream Online, OilPrice.com, Buenos Aires Herald, Energy Circle, Brazil Energy Insight, Business Honor, U.S. News, Reuters, FXStreet, OilMonster, OGAnalysis, Global Flow Control, Discovery Alert, OFTRB, Peak Oil Barrel, Guacamaya TV, IA.

By Elio Ohep, editor@petroleumworld.com
Dec. 27, 2025