In line with business specialists, Colombian President Gustavo Petro’s intention to stop offshore hydrocarbon exploration as a part of the nation’s shift to greener vitality sources might jeopardize Colombia’s vitality safety and financial well being.

Regardless of strides in restoration, the Colombian oil business has but to surpass its pre-COVID-19 operations, as investor and administration skilled Matthew Smith famous in an Oilprice.com article.

In Could 2023, Colombia, a rustic with vital oil reliance, pumped a median of 773,789 barrels per day (b/d).

Although this confirmed a notable yearly enhance, it was nonetheless 13.5% under the 894,519 b/d produced in Could 2019, highlighting that manufacturing hasn’t totally bounced again.

Smith provides that pure fuel manufacturing stays equally stunted, inflicting vital concern for Colombia, which is already grappling with potential fuel shortages.

Smith pinpoints varied components for this sluggish restoration.

Notably, the Colombian Petroleum Affiliation (ACP) highlighted that non-public oil firm exploration investments would see a 33% annual drop in 2023, plunging to US$700 million.

This funding dip, Smith speculates, may be linked to Petro’s tax hikes on the oil sector launched in November 2022 and his inclination to halt new oil exploration contracts.

Each strikes are pivotal in Petro’s blueprint to scale back Colombia’s fossil gasoline reliance.

For perspective, oil, an important financial driver for Colombia, comprised 29% of its export worth within the first half of 2023.

Smith additional means that safety issues, persistent protests in opposition to the oil business, and heightened geopolitical uncertainty have burdened Colombia’s hydrocarbon sector.

These challenges would possibly hinder Petro from securing wanted Congressional backing for his hydrocarbon exploration cessation proposal, stalling his activist agenda.

In line with the report, though ACP anticipated 55-60 exploration wells in 2023, knowledge from the Nationwide Hydrocarbons Company (ANH) signifies solely 28 exploration wells have been finalized within the preliminary 5 months of 2023.

Thus, Smith forecasts fewer wells for 2023 than the 68 drilled in 2022.

Moreover, as of July 2023, solely 24 drilling groups have been energetic in Colombia, down from 35 in late December 2022.

In conclusion, Smith believes Petro’s coverage might imperil Colombia’s vitality safety.

Given the looming pure fuel scarcity, there are issues that by 2028, Bogotá, at the moment a web oil exporter, would possibly transition into an importer.