Why the Venezuela Economy Is Accelerating Right Now — and Why That Growth Is Built on Fragile Ground

These days, strolling through eastern Caracas has an almost disorienting quality. Once more, the cafés along Las Mercedes are packed. Locals silently translate the prices of imported whiskey, which used to seem like a thing of the past, into dollars as it sits on shelves.

Tanker trucks are occasionally seen lined up on the highway heading toward José, the coastal petrochemical complex, just as they were fifteen years ago, when the nation still adhered to its own oil mythology. Compared to the quiet of only two or three years ago, it’s difficult to ignore the difference.

The numbers in the headline are impressive. Venezuela’s economy is expected to grow by about 12% this year after 19 straight quarters of moderate growth, which would be considered a clear success story in any other situation. The daily production of oil has surpassed one million barrels. Exports to the United States have recovered rapidly, averaging 329,500 barrels per day in recent months—a 192% increase over the average for 2025. More flexible licensing arrangements than in previous years are in place for joint ventures with Chevron, Repsol, Eni, and Maurel & Prom. Speaking with people in the industry gives me the impression that the worst is behind them. It is another matter entirely whether that sense is correct.

In terms of politics, the situation is unique and nearly spontaneous. Since Nicolás Maduro was captured in January, interim President Delcy Rodríguez has maintained the line on oil policy with what insiders characterize as a purposefully limited agenda: maintain production, reassure foreign partners, avoid picking fights you can’t win.

I believe it is accurate to interpret her appointment of Paula Henao as Minister of Hydrocarbons as a signal to foreign operators that the new administration prioritizes operational stability over ideological theater. Perhaps for the first time in a generation, this is pragmatic governance. It hasn’t been tested either.

If you look closely, you can see how all of this oil money is having second-order effects on the rest of the economy. The first half of 2025 saw a 14% year-over-year increase in cement output, which may seem insignificant when you consider how completely the construction industry collapsed between 2014 and 2020. Engineers and technicians, some of whom had driven for ride-sharing apps in Bogotá or Madrid for years, are once again being hired by oilfield service companies. Someone will need to construct the roads, storage tanks, pipelines, and logistics infrastructure needed for these projects, and that person is increasingly being paid in real money.

However, interpreting this as a clear recovery would be incorrect. The parallel state, the destroyed municipalities, and the social programs that functioned outside of any typical public system are just a few examples of the extensive institutional harm caused by the Chávez and Maduro eras. Maduro’s capture did not eliminate those structures; rather, they were inherited. The vulnerability that caused the 2014 oil price collapse to escalate into a humanitarian crisis has not been resolved; rather, it is merely concealed by a more favorable oil price.

Additionally, no one in Caracas seems prepared to take the diaspora issue seriously. Over the last ten years, almost eight million Venezuelans have fled. Welders, electricians, and project managers are needed for a construction boom, and many of them currently reside in Lima, Santiago, or Houston. A few are coming back. The majority are observing from a distance, watching to see if this continues. More than any economic indicator, their reluctance might be the best indicator of the real situation.