Payden & Rygel: Top 10 countries by oil reserves and oil production

Payden & Rygel: Top 10 countries by oil reserves and oil production

January 12, 2026

Commodities

There's a hard truth in global economic development: resource abundance does not guarantee prosperity. This week's geopolitical headlines are a reminder that oil reserves are not the same as oil production - nowhere more so than in Venezuela.

Despite holding the world's largest proven oil reserves, Venezuela has produced just 1% of global crude oil output over the past four years. By contrast, the U.S., whose reserves are only one fifth of Venezuela's is the world's largest oil producer, accounting for roughly 21% of global production.

The difference lies in capital, institutions, and time. Oil production is highly capital-intensive and slow to scale. What's more, political instability tends to suppress capital investment. Even if recent leadership changes mark an inflection point, any meaningful recovery in Venezuelan output would require substantial private capital and years to materialize.

The implication is straightforward: developments in Venezuela are unlikely to generate a near-term surge in global oil supply. Still, even a modest improvement in expected supply at the margin helps cap upside risks to energy prices, making a continued moderation in U.S. inflation more probable.

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