By: Staff Writer
June 12, 2026
Fitch Ratings said in a new regional report that the revival of the Venezuelan oil sector will assist with dampening the pressure from the global price of oil caused by the Iran war.
Fitch, in their “Latin America in Focus – 2026 Heightened Risks from Geopolitics and Elections,” said that removal of Venezuelan leader Nicolas Maduro in January demonstrates the Trump administration’s appetite to reassert U.S. influence in the Western Hemisphere and that is for a new ‘Monroe Doctrine’.
Latin America in 2026 faces heightened operational risks driven by a massive electoral supercycle, shifting U.S.-China trade dynamics, and regional security crises. While the region is experiencing voter fatigue with populism, structural fiscal challenges and political fragmentation continue to threaten long-term stability and cross-border investment.
“The U.S.’s National Security Strategy gives greater attention to countering China’s influence in LatAm.
“Some LatAm countries have demonstrated a more supportive attitude to the Trump administration’s strategic and economic agendas: Dominican Republic, which has allowed the U.S. access to airbases, El Salvador, Ecuador, Argentina, Chile, and Bolivia.
“Higher oil prices also provide incentives to revive Venezuela’s oil sector, which requires significant investments in the country’s outdated infrastructure.”
The report also said: “China is the top commodity export market for most of South America, and where it is not yet (Argentina, Bolivia, Ecuador), it is growing rapidly.
“Chinese demand for copper has been buoyant given the metal’s role in energy transition, and its booming demand for lithium for batteries and cars has benefited Argentina, Chile and, to a lesser extent, Bolivia.
“China’s steady consumption has meant continued demand for food products, such as soy. Paraguay does not export directly to China given that it recognizes Taiwan, but much of its soy exports to neighbors are processed and shipped on to China.”
Further adding: “Entrenched trade linkages between China and LatAm make commerce between them unlikely to stop. In fact, three countries that have reached trade deals with the U.S. – Argentina, El Salvador, Ecuador – saw growth in Chinese imports surge in 2025.
“However, U.S. trade deals with these countries signal the expectation for some coordination in trade policies against thirdparty countries.
“There could also be pressure against imports of goods deemed to pose security threats, i.e. telecom equipment from Huawei. Costa Rica already bans it, and the U.S. said it would help Panama replace its Huawei towers with U.S. technology.”
The Middle East conflict has resulted in higher energy prices, exchange rate fluctuations, and higher bond yields.
Higher-for-longer oil and gas prices, combined with supply-chain disruptions, could fuel inflation, worsen external balances and slow fiscal consolidation efforts, particularly in countries that have traditionally provided energy and food subsidies.