US companies are moving into Venezuela to tap into the country’s vast crude oil reserves, which could potentially lower electricity costs for Bitcoin miners and enhance their profit margins, according to analyses from the crypto exchange Bitfinex.
“Cheaper and more abundant energy would improve miner margins globally and could unlock a new phase of mining expansion, particularly in regions able to secure long-term power contracts,” the Bitfinex analysts noted in a report this Monday.
Following the US’s seizure of Venezuelan oil tankers last December, plans are being discussed to extract Venezuela’s substantial reserves of approximately 303 billion barrels of crude oil after apprehending the country’s president, Nicolás Maduro.
Currently, Chevron is the only major US oil firm operating in Venezuela, while former President Donald Trump is encouraging other significant players to step in and start production.
According to the Bitfinex team, these actions will create “immediate spillover effects” in energy markets and secondary effects on Bitcoin and the larger cryptocurrency marketplace. They mentioned that accessing only a small portion of Venezuela’s oil reserves could substantially influence energy prices.
In terms of duration, however, it is emphasized that any significant increase in Venezuelan oil output will likely take years, delaying benefits for the crypto industry. The pace of this increase will depend on how the US manages Venezuela’s political transition and the sanctions affecting the country.
“While the long-term potential is vast, analysts estimate it would require a decade and over $100 billion in infrastructure investment to restore the country to its former status as a production powerhouse,” said Matt Mena, indicating the scale of investment needed to realize these opportunities.
Historically, Venezuelan oil production has significantly declined over the past few decades—from around 3.5 million barrels per day in the 1970s to about 1 million barrels today, representing just about 1% of the world’s output.
In recent years, the economic situation in Venezuela has sharply deteriorated. Hyperinflation has diminished the bolívar’s purchasing power since 2013, combined with extensive political and institutional turmoil.
Crude oil prices dropped following the US intervention; for example, the benchmark fell to approximately $58 per barrel, marginally easing Bitcoin miners’ electricity cost pressures. As for the broader cryptocurrency market, the Bitfinex analysts suggested that prices are likely to be influenced more by macroeconomic shifts rather than solely by energy fundamentals.
