The commissioning of new oil fields in Brazil, Guyana, Argentina and Venezuela is turning Latin America and the Caribbean into one of the more important arenas of global energy competition. The region’s resources could have implications not only for global oil supplies but also for energy diplomacy.
Energy and sovereignty tensions in the Falkland Islands
The Sea Lion field being developed in the Falkland Islands is adding an energy dimension to the dispute between Argentina and the United Kingdom. The project envisages proven and probable reserves of 314 million barrels, along with an initial investment of approximately $1.8 billion. Initial production is expected to begin in March 2028 with a capacity of 50,000 barrels per day.
Argentine President Javier Milei is reportedly accelerating sanctions mechanisms targeting companies operating on the project. On September 4, 2026, Milei signed two decrees paving the way for sanctions against 45 foreign companies and shareholders. The companies involved in the project, meanwhile, argue that their licenses are supported by the UK government.
Venezuelan oil emerges as a point of US-China rivalry
Venezuela’s oil resources are also among the key issues in the rivalry between Washington and Beijing. Venezuela’s oil shipments to China, the US influence over the country’s energy sector and new investments are reinforcing assessments that the region’s economic and political balances could change.
The picture in Latin America points not so much to the emergence of a single power bloc as to the intensification of three overlapping rivalries over the same resources: the Argentina-UK, US-Venezuela and US-China rivalries. Whether countries in the region can use growing international interest to advance their own economic and political interests will be one of the decisive factors in this process.
