Michael Burry Bets On A Venezuelan Crude Rebound: From 'Short' To 'Sour'
Renowned investor Michael Burry, celebrated for his “The Big Short” trades, highlighted a strategic play to revitalize Venezuela’s petroleum sector.
- VLO stock is climbing. See the chart and price action here.
Following the capture of Venezuelan President Nicolas Maduro and subsequent calls by President Donald Trump for American industrial participation in the country's oil sector, Burry has reaffirmed his multi-year commitment to Valero Energy Corp. (NYSE:VLO), according to CNBC.
Burry's Refinery Bet
Burry's thesis centers on the specialized technical requirements of Gulf Coast refineries that were engineered to handle the specific chemical profile of South American “heavy” oil, which is dense and high in sulfur.
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Without the Venezuelan supply, those plants have operated with reduced efficiency for decades.
"Realize that many Gulf Coast refineries were purpose-built for Venezuelan heavy crude. So they have been running with suboptimal feedstock for years. This will, in time, produce better margins across jet fuel, asphalt, and diesel … I have owned Valero since 2020, and I am more resolved to holding it even longer after this weekend," Burry said, per CNBC.
Expanded Market Opportunities
Burry said that he owns Valero and Halliburton and that the shift in regional geopolitics suggests a broader “rebound” trade.
"Venezuelan pipelines and refineries are old and in disrepair. This work will go to U.S. contractors. Chevron is already there," Burry said.
He specifically pointed to other U.S. oil giants finally receiving closure to legal claims relating to their exits when the Venezuelan oil market was nationalized.
"Exxon and others have been litigating claims for decades and may see some justice relatively soon, if the US literally begins to run Venezuela as some have suggested. I own Halliburton, and may buy more shares or LEAPs," he added.
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Key Investment Targets Identified
Based on Burry’s insights and market analysis, the following companies are positioned as primary beneficiaries:
| Company | Sector | Role in Thesis |
| Valero Energy Corp. (NYSE:VLO) | Refining | Primary processor of heavy sour crude. |
| Halliburton Co. (NYSE:HAL) | Oilfield Services | Likely contractor for infrastructure repair. |
| Chevron Corp. (NYSE:CVX) Exxon Mobil Corp. (NYSE:XOM) | Exploration | Long-term recovery of assets and legal claims. |
Market Context
Burry's latest revelation aligns with his history of contrarian, value-driven positioning. By holding Valero since 2020, he weathered the pandemic-era volatility, anticipating a geopolitical “normalization” that would eventually unlock the value of complex U.S. refining assets.
As the U.S. moves to potentially oversee or support the management of Venezuelan resources, the “suboptimal” era for these refineries may be drawing to a close.
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