Likelihood that an increase of natural resources from Venezuela lower gas prices to the point of making drilling unprofitable similar to what we saw during covid?

I think it unlikely, given that Venezuela’s oil is heavy and sour, requiring billions of dollars of investment up front to increase local production capacity (the oil needs to be thinned before it gets extracted) and that the previous operators had really let the infrastructure deteriorate.

It looks like US majors aren’t terribly interested, since both the high up front cost and long term political stability (eg what happens even after Trump’s term ends in three years) and high extraction costs means that you’d want high $50s/low $60s crude price to make it viable, and that it would take years to get meaningful increases in production going.

That’s a far cry from the temporary oversupply pricing we saw during early COVID. Trump is talking about subsidizing us majors (eg us taxpayers footing the bill) to get them to go in, but I’m not convinced that’ll fly. I don’t think many economists consider his policies on energy to be long term winners or even rational (eg being so against clean energy and so supportive as to give federal dollars to prop up coal and gas).

This is a ”one man” arbitrary policy that is unlikely to survive the end of the current administration. Oil companies are ruthless in chasing profits, but they’re also very good long term planners. I don’t really see them investing a lot here, just enough to keep Trump from getting angry. There’s already plenty of excess capacity, so major producers have been closely adjusting production as needed to try and keep pricing up despite flat to only modestly rising demand since Covid.

To your question, Venezuelan oil is too expensive to lower pricing, and those with lower production costs are adjusting supply in any case to maintain pricing at profitable levels.