Guyana’s 2025 Election and the Strategic Risks and Opportunities in Its Oil-Driven Economy Amid Venezuela Tensions

Guyana’s 2025 general election, held on September 1, has emerged as a critical inflection point for its oil-driven economy and regional stability. With $10 billion in annual oil revenues projected by 2029, the outcome will shape how the country manages its newfound wealth, navigates its territorial dispute with Venezuela, and attracts foreign investment. The election’s three-way contest—between President Irfaan Ali’s People’s Progressive Party/Civic (PPP/C), opposition leader Aubrey Norton’s A Partnership for National Unity (APNU), and Azruddin Mohamed’s We Invest in Nationhood (WIN)—has exposed stark divergences in policy priorities, governance models, and geopolitical risk exposure.

Political Fragmentation and Oil Policy Divergence

President Ali’s PPP/C has positioned itself as the steward of continuity, emphasizing its experience in managing Guyana’s oil boom through its 2016 production-sharing contract with ExxonMobil. The party argues that renegotiating this agreement would destabilize investor confidence and disrupt projects like Yellowtail and Payara, which are central to Guyana’s $30 billion in planned oil investments [1]. By contrast, APNU and WIN have criticized the PPP/C for corruption and mismanagement, with Norton advocating for renegotiating oil contracts to secure higher social benefits and Mohamed leveraging his outsider status to attract younger voters [2].

The PPP/C’s emphasis on stability aligns with ExxonMobil’s interests, which have signaled confidence in the current regulatory framework [1]. However, the opposition’s calls for reform reflect widespread public skepticism about transparency and equitable wealth distribution. A PPP/C victory would likely preserve the status quo, while an APNU or WIN win could introduce regulatory uncertainty, potentially triggering international arbitration or delays in infrastructure projects [2].

Venezuela Tensions: A Geopolitical Wild Card

The Essequibo border dispute remains a shadow over Guyana’s oil sector. Venezuela’s 2023 referendum reaffirming its claim to two-thirds of Guyana’s territory, coupled with a March 2025 naval incursion near an ExxonMobil facility, has heightened operational risks [3]. While full-scale military conflict is unlikely due to Venezuela’s internal instability, the dispute has elevated insurance costs and security concerns for offshore operations [1].

President Ali has framed sovereignty as a central campaign issue, citing legal victories and international support for Guyana’s claims. However, an opposition victory could shift the government’s approach to the dispute, potentially complicating diplomatic and military strategies. The U.S. has also raised concerns about Mohamed’s U.S.-sanctioned status, which could strain bilateral relations and deter foreign partnerships [4].

Investor Implications: Stability vs. Reform

For foreign investors, the election outcome will determine the predictability of Guyana’s regulatory environment. The PPP/C’s continuity offers reassurance for ExxonMobil and other stakeholders, but its governance challenges—such as corruption allegations and delayed infrastructure projects—pose long-term risks [2]. Conversely, APNU’s pledge to renegotiate contracts within 90 days of a potential victory introduces uncertainty, though it could align with public demands for greater social returns from oil revenues [1].

WIN’s rise, despite Mohamed’s controversial background, highlights the appeal of anti-establishment rhetoric among younger voters. However, U.S. sanctions and questions about his leadership capacity could deter institutional investors seeking stable partnerships [4].

Navigating the Risks

Investors must weigh Guyana’s oil potential against geopolitical and governance risks. A PPP/C victory would likely sustain ExxonMobil’s $30 billion investment pipeline but may struggle with corruption and inequality. An APNU or WIN win could disrupt regulatory frameworks, though it might also spur reforms to address public discontent. Meanwhile, Venezuela’s actions—ranging from symbolic claims to military posturing—remain a persistent threat to operational security [3].

The Carter Center and other observers have raised concerns about electoral integrity, including biased state media coverage and voter list irregularities [2]. A contested or delayed election could create regulatory limbo, complicating long-term planning for energy projects.

Conclusion

Guyana’s 2025 election is a litmus test for its ability to balance oil-driven growth with democratic governance and regional stability. For investors, the key variables will be policy continuity, transparency in revenue management, and the government’s approach to Venezuela. While the PPP/C’s re-election appears to offer the most stable path for foreign energy investments, the opposition’s rise underscores the fragility of Guyana’s political landscape. As the country navigates its “resource curse” and geopolitical tensions, strategic investors must hedge against both regulatory shifts and regional volatility.

Source:
[1] Guyana’s Oil Election Dilemma: Political Risk vs. Resource [https://www.ainvest.com/news/guyana-oil-election-dilemma-political-risk-resource-potential-2508/]
[2] Geopolitical Risk and Electoral Stability in Guyana’s Oil [https://www.ainvest.com/news/geopolitical-risk-electoral-stability-guyana-oil-driven-economy-navigating-crossroads-opportunity-uncertainty-2509/]
[3] Guyana’s Oil, Elections and a Border Dispute [https://www.fairobserver.com/fofeatures/guyanas-oil-elections-and-a-border-dispute/]
[4] Venezuela’s Resurging Oil Exports and Geopolitical Tensions [https://www.ainvest.com/news/venezuela-resurging-oil-exports-geopolitical-tensions-strategic-window-energy-investors-2508/]