Tight global oil supplies, compounded by fears of further U.S. strikes against Iran, are stoking concerns over a potential oil price super-spike. Global petroleum inventories are shrinking, while U.S. fuel prices surge to historic highs, fueling inflation and intensifying pressure on the economy. As Middle East tensions disrupt shipping through the Strait of Hormuz, a chokepoint for one-fifth of global oil supplies, Guyana’s petroleum output continues to expand, helping to mitigate supply constraints and the risk of significantly higher prices.
By the end of August 2026, Guyana was lifting 908,000 barrels of oil per day, making the former British colony South America’s third-largest oil producer. Production is on track to exceed one million barrels per day before the end of December 2026, just seven years after the country first began pumping oil in December 2019. The speed of Guyana’s transformation is remarkable. From its first major offshore discovery at the Liza-1 well in 2015 to commercial production in 2019, the country has emerged as a major global petroleum producer and exporter in little more than a decade.
Guyana is now a regional oil powerhouse and leading global petroleum exporter. This massive, once-in-a-generation oil boom underway in the country is due to the prolific offshore Stabroek Block. Here, ExxonMobil, the operator with a 45% working interest, along with partners Chevron and CNOOC, which control 30% and 25%, respectively, has made over 35 high-quality oil discoveries. These have endowed the Stabroek Block with a notable 11 billion barrels of oil equivalent in recoverable oil and gas resources, among the largest in South America, cementing Guyana’s place as a major non-OPEC oil producer.
These are driving significant hydrocarbon production growth and will eventually lift Guyana’s petroleum output to around two million barrels per day by the end of the decade. There are currently four operational floating production, storage, and offloading (FPSO) vessels in the Stabroek Block. The most recent FPSO to commence operations was One Guyana at the Yellowtail project in August 2025. That facility, which has a capacity of 250,000 barrels per day, is steadily ramping up production as operational efficiencies and improvements are identified.
The Errea Wittu, which arrived in Guyana at the end of August 2026, is slated to come online at the $12.7 billion Uaru project before the end of this year. The facility will have 10 drill centers with 44 production and injection wells targeting a resource containing more than 800 million barrels of oil. This will be Exxon’s fifth operational facility in the Stabroek Block, adding a further 250,000 barrels per day to existing petroleum output. That will lift Guyana’s production to over one million barrels per day by the end of 2026, even potentially to as high as 1.2 million barrels daily.
Exxon continues to conduct exploration and appraisal drilling across the Stabroek Block while advancing four additional projects beyond Uaru: Whiptail, Hammerhead, Longtail and Haimara. Scheduled to start up between late 2026 and 2031, these facilities will add a combined 650,000 barrels of crude oil, 510,000 barrels of condensate and three billion cubic feet of natural gas per day to Guyana’s hydrocarbon output. By the end of the decade, the tiny nation is expected to produce more than two million barrels of oil equivalent per day.
Exploration drilling continues across the Stabroek Block and Guyana’s other offshore petroleum acreage. In early October 2026, Exxon announced a new discovery with the Rockhead-1 well in the Stabroek Block, approximately 115 nautical miles offshore and adjacent to the 2018 Ranger-1 discovery. The well forms part of the company’s exploration and appraisal program in the oil acreage where it has recorded over 46 discoveries. Despite the prolific petroleum fairway extending beyond the block’s boundaries, exploration success in the surrounding offshore acreage has so far been considerably more limited.
Nonetheless, Guyana’s once-in-a-generation oil boom is poised to strengthen energy security across the Americas and contribute to global supply resilience. The threat posed by Venezuela’s threats to annex the oil-rich Essequibo region, which accounts for three-quarters of Guyana’s territory and encompasses the Stabroek Block within its maritime boundaries, has been neutralized. The tiny South American country is a major regional petroleum exporter with around 60% of oil shipments sent to Europe and a third to the United States.
Export volumes will continue to rise as the country’s petroleum production expands. This will provide an alternate source of oil for countries impacted by supply constraints caused by heightened geopolitical tensions in the Middle East. U.S. imports of Guyana’s petroleum have risen significantly since 2021, as the country’s output has risen. This is not only bolstering regional energy security but also delivering a massive economic dividend for Guyana. For the first half of 2026, according to Georgetown, oil exports grew by a stunning 82% to surpass $15 billion in value.
Georgetown predicts annual petroleum revenues will rise to nearly $6.5 billion. As a result of the massive inflow of petroleum revenues and Exxon’s investment in the Stabroek Block, the International Monetary Fund (IMF) forecasts that Guyana’s gross domestic product (GDP) will expand by 22.3% in 2026. This makes the tiny nation the world’s fastest-growing economy. Indeed, since 2019, when petroleum production began, Guyana’s GDP has grown nearly eightfold to around $40 billion. This makes the once deeply impoverished South American country the continent’s richest on a per capita basis and the 10th wealthiest on that basis globally.
By Matthew Smith for Oilprice.com
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