Latin American oil production is dominated by Brazil, Mexico, and Venezuela. These countries are responsible for about 75% of the region's total output and are also giants on the international stage, ranking as the world's 10th, 11th, and 12th-biggest oil producers, respectively. Colombia also makes a good showing in the world rankings, coming in at 22nd. The following list provides production figures for each of the region's top four oil producers and a few details about each country's oil industry.

1. Brazil

Brazil accounts for oil production of about 2.5 million barrels per day and is the tenth-largest oil-producing country in the world. According to the U.S. Energy Information Administration (EIA), more than 90% of Brazil's oil production is extracted from deep-water oil fields offshore. In addition, Brazil has nearly 13 billion of barrels in proven oil reserves, which is the second-largest in Latin America after Venezuela.

Key Takeaways

  • Latin America is home to many large oil-producing countries.
  • Mexico, Brazil, and Venezuela account for nearly 75% of the oil production in the region and are the 10th, 11th, and 12th-largest producers in the world.
  • A large percentage of Brazil's oil, which amounts to 2.5 million barrels per day, is produced by Petrobras.
  • Venezuela has the world's largest oil reserves at more than 300 billion barrels.
  • Columbia and Argentina are the fourth and fifth-largest oil producers in Latin America.

Brazil exports roughly 1 million barrels of oil per day, but is also an oil importer from the Middle East and Africa. Crude oil from Saudi Arabia accounts for roughly half of its imports. The transportation sector, which represents one-third of total energy consumption in the country, is the source of the most demand for oil in Brazil.

Petroleo Brasileiro S.A., also known as Petrobras, is the biggest oil producer in Brazil by a substantial margin, accounting for about 2 million barrels per day and over 70% of Brazil's oil production. The Brazilian government holds 54% of the company's voting shares and controls another 10% of the company through shares held by the Brazilian Development Bank and Brazil's Sovereign Wealth Fund.

2. Venezuela

Venezuela produces roughly 2.2 million barrels of oil per day. Production in recent years is down from the prior two decades, when daily production fluctuated around the 3 million barrel mark, including a high of more than 3.5 million barrels per day in 1997. According to EIA,

"Reduced capital expenditures by state-owned oil and natural gas company Petròleos de Venezuela, S.A. (PdVSA) are resulting in foreign partners continuing to cut activities in the oil sector, making crude oil production losses increasingly widespread. With Venezuela’s heavy dependency on the oil industry, the country’s economy will likely continue to shrink, and that the runaway inflation will remain the mainstay at least in the short term."

Petroleos de Venezuela S.A. was established in 1976 immediately after the nationalization of the oil industry. In the 1990s, reforms were introduced to liberalize the industry, but policy instability has been the norm in the years since, especially after President Hugo Chavez came to power in 1999.

In 2006, Chavez introduced policies that required renegotiation of existing joint ventures with international oil companies. International operators were required to grant a 60% minimum share of every project to Petroleos de Venezuela. More than a dozen international companies, including Chevron and Royal Dutch Shell, acceded to the demands. The Venezuelan operations of two companies—Total S.A. and Eni S.p.A.—were nationalized after negotiations failed. Other international companies chose to exit Venezuela soon after, including Exxon Mobil Corporation and ConocoPhillips Co.

Although policy uncertainty remains in Venezuela even after the death of Hugo Chavez in 2013, many international oil and gas companies continue to maintain operations in the country. Chevron and the Chinese oil giant China National Petroleum Corporation both signed investment agreements with Petroleos de Venezuela in 2013 to update and expand on existing joint ventures. In 2015, the Russian energy conglomerate, Rosneft OAO, agreed to a $14 billion investment plan, the largest reported international investment in the Venezuelan oil industry in recent years. The country today has more than 300 billion in proven oil reserves and the largest in the world.

3. Mexico

Mexico produces just more than 2 million barrels of oil per day, but levels have diminished, mostly due to declining output from mature oil fields. From 1991 to 2010, Mexico maintained oil production above 3 million barrels per day, including eight years exceeding 3.5 million barrels per day. While Mexico maintains its position as the third-largest crude oil exporter in the Americas, it has become a net importer of refined products, primarily gasoline and diesel.

From 1938 to 2013, Mexico's oil industry was monopolized by the state-owned oil and gas company Petroleos Mexicanos, also known as Pemex. Industry reforms were initiated in 2013 in hopes of attracting greater foreign investment to reverse production declines in the country. Pemex remains under state ownership and controls development rights to over 80% of Mexico's proven reserves of oil.

4. Colombia

Columbia accounts for production of just under 900,000 barrels of oil per day. The country has made substantial production gains, raising output from under 550,000 barrels per day in 2007. According to EIA, recent high rates of growth in oil, gas, and coal production in Colombia can be attributed to energy industry reforms introduced in 2003. These reforms primarily worked to make investments in Colombian energy exploration and production more attractive to international companies. International investment in the oil industry reached more than $4.8 billion in 2014, about 30% of total foreign direct investment (FDI) in the country. By way of comparison, Colombia attracted only $278 million in oil-sector FDI in 2003.

Prior to the 2003 energy reforms, the Colombian oil and gas industry was controlled by Ecopetrol S.A., a state-owned oil and gas company and industry regulator. The reforms removed regulatory functions from Ecopetrol and opened up Colombia to international competition. Ecopetrol remains under the control of the Colombian state, which holds 88.5% of its outstanding shares. The company is listed on the Colombian Stock Exchange and has ADR listings on the New York Stock Exchange and the Toronto Stock Exchange.

Argentina

produces roughly 510,000 barrels per day, making it the fifth-biggest oil producer in Latin America and 28th-largest in the world.

Headquartered in Bogota, Ecopetrol is responsible for more than 500,000 barrels of oil per day, approximately 55% of Colombian production. More than 100 international oil and gas companies operate in Colombia, often in joint ventures with Ecopetrol or other operators. The biggest international oil and gas producers in the country include Chevron, Repsol, Talisman Energy, Occidental Petroleum, and Exxon Mobil.