Canadian Oil Tycoon Offers to Help US Restart Venezuela's Oil Industry

• Strathcona Resources is willing to send a technical team to Venezuela if requested, though it is not seeking investment opportunities there
• Canada exports about 90% of its crude to the U.S., and increased Venezuelan heavy crude production could compete with Canadian barrels refined on the U.S. Gulf Coast
• The discount on heavy Canadian crude to U.S. oil widened by 14% last week amid concerns about potential Venezuelan competition and uncertainty around the Canada-U.S.-Mexico trade agreement renewal

Summary

Canadian oil executive Adam Waterous, Executive Chairman of Strathcona Resources, is proposing that Canada leverage its heavy oil extraction expertise to help the United States rebuild Venezuela's oil industry. Strathcona, Canada's fifth-largest oil producer, would be willing to send a technical team to Venezuela if requested, though the company is not seeking direct investment.

Key Developments:

President Trump recently met with U.S. oil executives to discuss Venezuela, though no Canadian companies attended. Waterous, who has U.S. connections through former President George W. Bush's son-in-law Henry Hager (Strathcona's managing director), believes Canada's decades of heavy oil experience make it uniquely positioned to assist, as Venezuelan crude is similar to Canadian heavy oil.

Market Implications:

The proposal comes amid strained Canada-U.S. trade relations, with the Canada-United States-Mexico Agreement up for review this year. Canada currently exports approximately 90% of its crude to the U.S., making it vulnerable to competition from Venezuelan oil.

Market analysts warn that increased Venezuelan heavy crude production could compete with Canadian barrels refined on the U.S. Gulf Coast, potentially weakening Canada's negotiating leverage. The discount on heavy Canadian crude to U.S. oil already widened by 14% last week.

Waterous emphasized that the long-term risk of increased Venezuelan supply heightens the need for Canada to diversify its export markets and build additional pipeline infrastructure to the Pacific coast.

Strategic Context:

While positioned as an opportunity to support the U.S., the move also represents a defensive strategy for Canada's oil sector facing potential displacement by Venezuelan production.