On January 3, the United States launched a law enforcement and military operation that resulted in the capture of Venezuelan President Nicolás Maduro and his wife. Interim leadership has been assumed by Vice President Delcy Rodríguez, who was subsequently sworn in as interim president.
Why this matters
Venezuela has long been considered a high-risk environment for business. The country holds some of the largest oil reserves in the world, but production has been constrained for more than a decade. According to media reports, oil exports have been disrupted, and output is frozen under U.S. controls following these events. Analysts are watching for price volatility and increased risk premiums in energy markets.
Financial markets have also reacted. Energy companies and defense contractors are seeing movement in their stock prices and precious metals have experienced short-term rallies.
Practical tips for CPAs and finance professionals to consider, as appropriate:
Review risk exposure: Identify any direct or indirect ties to Venezuelan entities, operations, suppliers or clients.
Update financial models: Incorporate potential volatility in oil prices and currency exchange rates.
Evaluate disclosures: Ensure subsequent events and geopolitical risks are properly addressed in financial statements.
Stress-test current expected credit loss (CECL) models: Adjust assumptions for change in default risk in affected region.
Communicate with clients: Proactively discuss potential impacts and mitigation strategies. You may want to recommend clients or your organizations seek legal advice regarding current sanctions and/or embargoes to ensure compliance.
Bottom line
If you have direct or indirect ties to the energy industry or Venezuela, now is the time to review financial models, disclosures and compliance strategies for geopolitical risk. Standard protocols remain critical in this environment. Stay tuned for further updates from AICPA and CIMA as the situation evolves.
Related resources
Business Resilience Toolkit — Real-world examples and strategies to drive sustainable success