Latin America’s New Risk Cycle: Why Venezuela is the "Strategic Anchor"

Along the “belt of instability” stretching from the mountainous borders of Colombia and Venezuela to the Mexico–U.S. migration corridor, Latin America is entering a new cycle of risk. Here, conflict does not necessarily begin with tanks crossing borders; instead, it starts through small “fault lines”: sanctions, smuggling, the weaponization of crime, information warfare, and energy disputes. These tensions then abruptly erupt when a trigger event appears. Many regional security experts call this a phase of “structural tension accumulation”: states are stretched thin by social crises, non-state armed networks are expanding, and Great Power competition has returned to Washington’s “backyard.”

In this landscape, Venezuela emerges as a geopolitical nexus: it is simultaneously an energy puzzle, a convergence point for U.S.–China–Russia influence, and a “radiation point” for trans-border instability. From an expert perspective, the greatest risk is not just a war of words, but a potential chain of simmering collisions involving embargoes, oil, debt, security presence, and armed groups. These could cross the threshold and transform into a confrontation “on the ground.”

Venezuela serves as both a “card” and a gamble for both the United States and China. The “shadow war” within Venezuela will determine regional stability; if China and Russia prevail in this covert struggle, actual conflict could break out between the U.S. and forces within Venezuela, spreading instability across the entire region.

When Latin American Tensions “Shift Shape”

Conflict and security research centers have recently highlighted a new characteristic of Latin American instability: the lines between “organized crime,” “armed groups,” “migration crises,” and “geopolitical confrontation” are increasingly blurred.

Mexico epitomizes the “securitization” of crime: cartel violence is no longer just an internal matter but a bilateral pressure point for Washington. This has led to debates on redefining the crisis—shifting from anti-narcotics to counter-terrorism, increasing surveillance, and ramping up policy pressure.
Colombia represents “trans-border” instability: armed groups fight over territory, smuggling routes, and control over communities along the Venezuelan border. Human Rights Watch has described severe abuses and massive displacement in border areas like Catatumbo, signaling that Colombia’s internal conflict can “leak” into neighboring regions via porous borders.
Venezuela acts as the junction of these two trends. It is simultaneously an economic and social “pressure cooker” (due to sanctions and declining state capacity) and a “strategic stronghold” (oil, debt, and security links with Russia, China, and Iran). Geo-economic analyses emphasize that Venezuela provides U.S. adversaries with a rare foothold in the Western Hemisphere, moving far beyond mere trade.

How Important is Venezuela?

1) Oil is a Political Lever, Not Just a Commodity

Venezuela’s strategic value begins with oil. This is not just due to its reserves and specific heavy crude quality, but because Venezuelan oil is tied to an ecosystem of “sanctions, licenses, shipping workarounds, and finance.” Every policy shift creates a ripple effect across the region. Analyses of China-Venezuela relations often describe a “oil-for-loan” structure: Beijing injected massive capital through loans, repaid over time with crude oil.

The key point—and where the argument holds weight—is that when a long-sanctioned nation possesses strategic resources, it easily becomes a “chessboard” for Great Powers to test each other’s endurance and limits. In this logic, Venezuela is a gamble: for the U.S., it is a question of how much it can reshape the order in the Western Hemisphere; for China, it is about preserving economic-energy interests without being drawn into a direct confrontation.

2) Debt and Investment: Long-term “Binding Strings”

Recent statistics show that China committed vast amounts of capital to Venezuela over two decades. Although many loans have been repaid, the “remnants” of these debt-and-oil ties create a bond of mutual interest and political expectation. This makes Venezuela the “card” described above: not a card to be played once and discarded, but one that remains on the table for a long time, forcing all parties to calculate every move. If Washington tightens the noose or changes licensing regimes for oil flows, the risk of “colliding” with third-party interests (oil buyers, lenders, shippers) increases.

3) Security Presence and Geopolitical Symbolism

Venezuela holds symbolic weight: an openly anti-U.S. administration in a region Washington has historically viewed as its sphere of influence. Analyses of Russia–Venezuela relations highlight energy and defense cooperation as part of a Russian “pivot” in the Western Hemisphere, even amidst sanctions.

Current Note: On January 13, 2026, Reuters reported that Russia refuted U.S. claims regarding “control over Venezuela and its oil,” while emphasizing the legality of Russian oil assets there. While this is a diplomatic/media development, it underscores the sensitivity of Venezuela in the broader power struggle. Venezuela could increase the influence of China and Russia right in the U.S. backyard—much like Cuba during the Cold War—forcing the U.S. to reallocate global resources. If Venezuela hosts Chinese or Russian bases, the U.S. would face a vulnerable “open flank” at home.

The Venezuelan Hotspot: A Regional “Detonator”

The Venezuela-Guyana (Essequibo) Dispute: Border Conflict Fueled by Oil

In the fastest-erupting scenarios, territorial disputes cross thresholds easily because they have clear borders and objects of contention. Organizations like the International Crisis Group view the Essequibo dispute as a high-risk point, especially as offshore oil discovery in Guyana creates new interest variables. CSIS has also analyzed Caracas’s maritime strategic moves within the context of sovereignty disputes. A small collision at sea could easily become a “trigger event.”

The Colombia-Venezuela Border: A “Gray Zone”

While Essequibo is a state-vs-state risk, this border is a “networked” eruption risk: armed groups and criminals exploit terrain and weak governance to expand. If this “gray zone” falls further under non-state control, the risk of instability spreading to neighbors and inviting external intervention increases.

Mexico: A Different Kind of Hotspot

One cannot discuss Latin American conflict without Mexico. It is where migration pressure, drugs, and border security converge, and where U.S. politics can “crank up the heat” rapidly. The CFR describes Mexico’s criminal violence crisis as a long-term issue impacting migration and U.S. relations. If Washington feels it is losing control in one area (Mexico), it may seek to project strength in another (Venezuela), or conversely, avoid opening a new front. This fluctuation makes the region unpredictable.

The “Shadow War” and the Threshold of Real Conflict

The “shadow war” can be interpreted through three layers:

Geo-economics: Who controls the oil flow, the cash flow, and the “safe” shipping channels? Whoever controls Venezuela could arguably shape the 21st-century oil market.
Security and Deterrence: Who helps bolster the regime’s “hardness” and defensive capabilities enough to make an adversary hesitate?
Legitimacy and Narrative: The battle over whether Venezuela is defined as an “internal matter,” a “humanitarian crisis,” or a “gateway for U.S. rivals” dictates international involvement. If the U.S. intervenes deeply in Venezuela, it could inadvertently “legitimize” actions by China and Russia in Taiwan or Ukraine.

When these three layers resonate, the risk of a “phase shift” occurs. If one side feels it is losing the shadow war, they are incentivized to upgrade their actions to regain the initiative. That is the moment actual conflict may flash.

However, a “war between the U.S. and forces in Venezuela” likely won’t start with a formal declaration. It would likely emerge as a chain of escalations: a maritime incident, a border clash, an attack on oil infrastructure, or an internal political void. Because there are now so many international players involved, any military escalation forces a massive recalculation of risks on the strategic chessboard.

The Domino Effect

Latin America faces non-linear escalation risks. It can remain quiet for a long time and then explode due to a minor event. Mexico is a hotspot for cartel violence; Colombia for border-bound armed groups; but Venezuela is the “Key” because it converges oil, sanctions, territorial disputes, and Great Power competition.

If Venezuela is the gamble for both Washington and Beijing, then the “shadow war” is a very real contest of economic and security levers. When one side feels they are about to lose that hidden game, they may seek to “change the rules.” At that point, the region faces not just instability, but a domino effect of conflict: from Caracas to the Colombian border, out to the waters of Guyana, and resonating with the security pressures in Mexico.