The Iran war and its fallout have reduced the world’s oil and natural gas supplies for years to come. The shortfall will need to be taken up by other producers. Are there investing opportunities related to this pivot from Middle East oil suppliers to others around the world? In particular should you be investing in the Latin America oil and natural Gas boom referenced in a recent Bloomberg article about Latin America’s oil boom?
Snapshot of World Oil Production
The biggest producers of oil by rank for 2025 were the USA at 13.7 thousand barrels a day, Russia at 10,000 barrels a day, Saudi Arabia at 9,940 barrels a day, and Canada at 5,200 barrels a day. Next in line are China, Iran and the United Arab Emirates all in the 4,000 barrels a day range. Following on the list are Brazil in the 3,000 barrels a day range followed by Kuwait and Kazakhstan in the 2,000 barrels a day range and Norway, Mexico, Nigeria, Libya, Qatar, Algeria, Angola, Oman, and Venezuela all in the 1,000 barrels a day range. Countries producing less than 1,000 barrels of oil a day include Guyana, Argentina, Colombia, India, Indonesia, the United Kingdom, Azerbaijan, Malaysia, and Egypt. These are followed by nearly seventy more nations producing less and less oil as one goes down the list.
Where Will Oil and Natural Gas Come from Until the Persian Gulf Situation Is Remedied?
While none of the Latin American oil and natural gas producers stands in the top ranks, the sum total of oil produced in Latin America comes to a bit more than produced by Canada, the world’s fourth leading producer. And, as noted by Bloomberg. Nearly half of the growth in energy supply going toward 2030 will come from Latin American producers, Brazil, Argentina, Venezuela, and Guyana. That amount may come to more if the next Colombian president later this year takes away drilling restrictions currently in effect in that country under current President Gustav Petro whose single five year term expires this year.
Latin American Oil and Natural Gas Investment Opportunities
Although nearly half of the increase in natural gas and oil supplies in the coming years will come from Guyana, Brazil, Venezuela, Argentina and, perhaps, Colombia what are your specific investment opportunities that could come from this situation? This area today provides scalable resource potential, visible project pipelines, and stable environments for investment. Three energy stocks from Latin America are Petrobras, Ecopetrol, and Pampa Energia. Pampa Energia trades on the NYSE with one ADR equal to twenty-five shares of the stock. Petrobas ADR shares on the NYSE represent two share of the stock. ADR shares of Ecopetrol represent twenty shares of the stock. All of these stocks pay dividends. Each of these stocks has at least a “hold” and usually a “buy” rating by those who track them.
Investing in Oil Stocks via American Depositary Receipts
Mom and pop investors can take advantage of foreign investment opportunities using American Depositary Receipts. However, they need to be aware that while the ADRs they purchase are denominated in dollars, the underlying foreign stocks are denominated in the currency of the stock’s home country. While currencies of both Brazil and Guyana are reasonably stable the same can not be said for either Venezuela or Argentina. Thus, Petrobras may be a reasonable choice for investment based on the forthcoming energy boom and a stable Brazilian currency. Guyana has a stable currency but the energy consortium involved in Guyana in led by ExxonMobil thus your investment would not be in an ADR but rather a US based stock. Based on potential currency exchange issues both Venezuela and Argentina may be problems for unwary investors. To the extent that a new president allows more oil and natural gas production in Colombia, the Colombian peso is currently gaining ground against the US dollar!
