Michael Barry attends the premiere of ‘The Big Short’ at the Ziegfeld Theater in New York on November 23, 2015.
Dimitrios Cambris | Getty Images
Michael Burley’s quiet bet on Venezuelan oil is back in the spotlight.
The investor best known for “The Big Short” said he owns it. valero energy Since 2020, he believes this position has become increasingly attractive as the United States seeks to play a deeper role in reviving Venezuela’s oil industry.
“Recognize that many of the Gulf Coast refineries were built specifically for Venezuelan heavy crude oil,” Barry wrote in a Substack blog post on Monday. “So they have been operating with sub-optimal feedstocks for years, which will, over time, give them better margins across jet fuel, asphalt and diesel…I have owned a Valero since 2020 and am determined to keep it for even longer after this weekend.”
His comments came after President Donald Trump called on U.S. oil companies to invest in Venezuela following the overthrow of President Nicolas Maduro. Venezuela is a founding member of OPEC and has the world’s largest proven oil reserves. The country’s oil is one of the heaviest and most sulfur-containing in the world, and there are only a limited number of refineries equipped to efficiently process it.
While Valero stands out for its ability to process heavy crude oil, Barry said there are also smaller refiners, including: PBF energy and HF Sinclair Even if Venezuelan oil arrives only gradually, there could be benefits. It will likely take several years for exports to recover significantly.
Several Wall Street analysts have also highlighted Valero as the biggest beneficiary if Venezuela’s supply increases. The company’s stock rose about 10% on Monday.
Opportunities can extend beyond sophistication. Venezuela’s oil infrastructure is aging after decades of underinvestment, Barry said, creating potential demand for U.S. oilfield services companies once a major rebuild begins.
Barry said he owned it. halliburtonand Schlumberger baker hughesIt could be used to rebuild pipelines and refineries.
“Venezuela’s pipelines and refineries are old and in disrepair. The work will be outsourced to American contractors,” he said. “Chevron is already there. Exxon and others have been litigating claims for decades, and if the U.S. starts literally running Venezuela as some are suggesting, we might see some justice relatively soon. I own Halliburton and might buy more stock or LEAP.”
LEAP (Long Term Equity Expectancy Security) is a long option with an expiration date that can exceed one year.
