7 Stocks That Could Win Bigly from a US friendly Venezuela · DCG Trader Community

Jamar James

Jan 3 • 📈 A.I. TRADING CHAT

7 Stocks That Could Win Bigly from a US friendly Venezuela

Energy Sector

ConocoPhillips (COP)Loss: In 2007, the Venezuelan government expropriated ConocoPhillips' significant stakes in the Hamaca and Petrozuata heavy crude oil projects after the company refused to agree to new terms that gave the state majority control. The company has spent over a decade fighting for compensation.Potential Gain: A friendly government could facilitate the payment of outstanding arbitration awards. ConocoPhillips has won awards totaling over $10 billion (including interest) from international tribunals (ICSID and ICC), most of which remains unpaid. A new administration could also offer the company a pathway to re-enter the country's vast oil fields under favorable terms to settle these debts.
ExxonMobil (XOM)Loss: Similar to ConocoPhillips, ExxonMobil's assets in the Cerro Negro project were seized in 2007 after it rejected the government's demand to cede control to the state oil company, PDVSA. The company wrote off hundreds of millions in assets and has been locked in legal battles for compensation.Potential Gain: ExxonMobil has an outstanding arbitration award of approximately $1 billion (a portion of a larger claim that was reduced). A US-aligned government would likely prioritize settling these international legal obligations to restore investor confidence, providing a direct cash infusion to the company.
Chevron (CVX)Loss: Unlike its peers, Chevron chose to stay in Venezuela, accepting minority stakes in joint ventures with PDVSA. However, it has suffered from operational restrictions, corruption, crumbling infrastructure, and the inability to repatriate profits. It is owed billions in unpaid debts by PDVSA.Potential Gain: Chevron is the only major US oil company still operating on the ground. A regime change would likely lift sanctions and operational restrictions, allowing Chevron to ramp up production, export freely to the US, and finally collect the billions in debt it is owed by the state oil company.
The Williams Companies (WMB)Loss: The energy infrastructure company had its gas compression assets seized by the government. It initiated arbitration to recover the value of these investments.Potential Gain: Williams has an unpaid arbitration award recognized by US courts. A friendly government would be expected to honor these debts as part of a restructuring of Venezuela's external obligations.

Industrial & Consumer Goods

O-I Glass (formerly Owens-Illinois) (OI)Loss: In 2010, Hugo Chavez ordered the expropriation of Owens-Illinois' two glass manufacturing plants in Venezuela, accusing the company of exploiting workers and damaging the environment. The company was the largest glass container supplier in the country at the time.Potential Gain: An international tribunal ordered Venezuela to pay over $370 million (plus interest) in compensation for the unlawful seizure. A new government would likely negotiate the payment of this award or potentially offer the return of the facilities to attract foreign manufacturing investment back to the country.
The Clorox Company (CLX)Loss: Clorox exited Venezuela in 2014, shutting down its operations after the government imposed price controls that forced it to sell products at a loss. In response, the Maduro government seized the company's production facilities and turned them over to workers.Potential Gain: While Clorox wrote off the assets years ago, a US-friendly government could offer compensation for the seized factories or invite the company to reclaim its facilities and re-enter the market without the threat of price controls, tapping into a consumer base starved for basic household goods.
Kimberly-Clark (KMB)Loss: In 2016, the Venezuelan government seized Kimberly-Clark's factories after the company halted operations due to the inability to obtain raw materials and high inflation. The regime took over the production of diapers and tissues.Potential Gain: Similar to Clorox, Kimberly-Clark could receive compensation for its seized assets or the opportunity to reclaim its production facilities to serve a market with severe shortages of personal care products.BONUS Stocks:Here are several "less obvious" US companies—beyond the major oil and consumer giants—that suffered significant losses due to asset seizures, nationalization, or "trapped cash" policies in Venezuela.

Manufacturing & Industrial

General Motors (GM)Loss: In 2017, Venezuelan authorities illegally seized GM’s assembly plant in the industrial hub of Valencia. The seizure was sudden and aggressive; authorities took control of the factory and its assets (including vehicles) and forced the company to terminate operations immediately. GM wrote off approximately $100 million related to the seizure.Potential Gain: A US-friendly government could return the facility to GM or offer compensation. More importantly, it would reopen a once-lucrative automotive market where GM was a historical leader, allowing them to resume sales in a country with an aging vehicle fleet desperate for replacement.
The Goodyear Tire & Rubber Company (GT)Loss: In 2018, Goodyear was forced to cease operations at its Venezuelan plant due to economic conditions and US sanctions. The government subsequently seized the facility and began producing tires under a new name using Goodyear’s equipment and molds. Goodyear wrote off its investment and deconsolidated its Venezuelan operations.Potential Gain: Reclaiming the facility would allow Goodyear to dominate the local tire market again. Additionally, stopping the unauthorized production of tires using their molds would protect their brand integrity and intellectual property.

Food & Agriculture

Kellanova (formerly Kellogg) (K)Loss: In 2018, the Maduro government seized Kellogg’s cereal plant after the company announced it was pulling out of the country due to the economic crisis. The government handed the plant over to workers and continued to produce cereal using Kellogg’s branding (like "Corn Flakes") without permission, a direct violation of trademark rights.Potential Gain: A new government would likely halt the state-run production of counterfeit Kellogg’s products. Kellogg could then negotiate the return of the plant to resume official production, capitalizing on its strong brand recognition in the region.
Archer-Daniels-Midland (ADM)Loss: While less publicized than factory seizures, agricultural giant ADM had significant operations in Venezuela that were harmed by price controls and the nationalization of ports and distribution networks. They eventually ceased most operations and wrote off millions in assets.Potential Gain: As a global food processing leader, ADM would be essential in rebuilding Venezuela’s shattered food supply chain. A friendly government would likely invite ADM back to help modernize grain imports and processing infrastructure.

Mining

Gold Reserve Inc. (GDRZF) (Headquartered in Spokane, WA; listed on TSX-V and OTC)Loss: This smaller mining company is perhaps the most dramatic "pure play" example. Its world-class Brisas gold and copper project was expropriated by the Chavez government in 2008. The company won a massive arbitration award (approx. $1 billion), but payment has been sporadic and incomplete.Potential Gain: Unlike the oil majors where Venezuela is just one part of a global portfolio, Gold Reserve’s stock price is heavily tied to this specific settlement. A US-friendly government that honors the arbitration debt or allows them to finally develop the mine would be a massive catalyst for this stock.

Oil Services (The "Unpaid Bills" Group)

Halliburton (HAL) & Schlumberger (SLB)Loss: Unlike the oil producers (like Exxon) who had assets seized, the service companies stayed to work for the state oil company, PDVSA. The harm here was non-payment. PDVSA simply stopped paying its bills, racking up hundreds of millions (and at times billions) in unpaid receivables for work already performed. Both companies eventually had to write off these massive debts and curtail operations.Potential Gain: A restructuring of PDVSA under a new government would involve settling these old debts, likely at a discount but still resulting in a significant cash injection. Furthermore, the rehabilitation of Venezuela’s degraded oil infrastructure will require the specific technical expertise that only these firms can provide, guaranteeing them lucrative new contracts.

Airlines (The "Trapped Cash" Group)

American Airlines (AAL)Loss: American Airlines (along with Delta and United) was harmed by Venezuela’s currency controls. They sold tickets in local currency (Bolivars) but the government refused to convert that cash into US Dollars as promised. In 2016, American Airlines wrote off over $500 million in revenue that was effectively "trapped" in the country and became worthless due to hyperinflation.Potential Gain: While the old cash is likely gone forever, a friendly government would normalize air travel and currency exchange. American Airlines, which historically had the most extensive network to Venezuela from Miami, would be the primary beneficiary of renewed business travel and tourism links between the two nations.

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