As 2025 draws to a close, the global energy landscape remains defined by a volatile cocktail of geopolitical brinkmanship and shifting trade alliances. From the "Trump effect" accelerating U.S. LNG exports to the precarious status of cross-border gas deals in South America, the market has spent much of the year in a state of high alert. Yet, amidst this uncertainty, the Central Bank of Trinidad and Tobago (CBTT) has released a year-end assessment that highlights a surprising narrative of resilience, positioning the Caribbean nation as a critical case study in how energy-producing economies can navigate global headwinds through strategic project execution and pragmatic diplomacy.
According to the CBTT’s December 2025 Economic Bulletin, Trinidad and Tobago’s energy sector has effectively acted as a fiscal buffer, stabilizing the national economy even as regional neighbors grapple with "energy inflation." While the first quarter of 2025 saw a minor contraction, a "notable surge" in the second half of the year—marked by double-digit growth in natural gas production—has allowed the country to maintain its monetary stability. With the Repo rate held steady at 3.5% throughout the year, the Central Bank has signaled that the energy sector’s rebound is the primary driver of the nation’s 1.3% GDP growth in 2025, providing a blueprint for regional stability in an era of "mercurial" international policy.
A Turnaround in the Trenches: The 2025 Production Rebound
The resilience cited by the Central Bank is not merely a product of high prices, but a result of a multi-year effort to reverse a decade of structural decline in hydrocarbon output. In early 2025, natural gas production averaged roughly 2.5 billion cubic feet per day (bcf/d), but by the fourth quarter, that figure climbed toward 2.6 bcf/d. This uptick was driven by the successful commissioning of several "backfill" projects that have breathed new life into the country’s aging infrastructure. Key milestones included the first gas from the Cypre project in the second quarter and the Mento field shortly thereafter, both of which provided critical supply to the Atlantic LNG complex.
The timeline leading to this moment was fraught with challenges. Throughout 2024 and early 2025, the industry faced significant supply chain disruptions and rising costs associated with new U.S. tariff policies. However, the Trinidadian government’s "quiet diplomacy" with Washington proved instrumental in securing and maintaining special licenses for cross-border projects. Stakeholders, including the National Gas Company of Trinidad and Tobago (NGC) and major multinational operators, spent much of the year navigating the complexities of the U.S. Office of Foreign Assets Control (OFAC) regulations, particularly concerning the high-stakes Dragon gas field venture with Venezuela.
Initial market reactions to the CBTT’s findings have been cautiously optimistic. Energy analysts point to the stabilization of crude oil production—which hovered between 52,800 and 55,000 barrels per day in late 2025—as a sign that the sector has finally found its floor. While the industry is still far from its 2010 peaks, the 11.7% year-on-year increase in natural gas production recorded in the second quarter of 2025 has provided the foreign exchange liquidity necessary to keep the Trinidadian dollar stable and inflation contained at a remarkable 0.4%.
Winners and Losers in the Caribbean Energy Corridor
The primary beneficiaries of this resilient environment have been the "Big Three" operators who have doubled down on their Caribbean portfolios. BP (NYSE: BP), through its local subsidiary bpTT, has emerged as a major winner following the successful startup of the Cypre and Mento projects. These subsea tiebacks have allowed the company to maximize existing infrastructure while minimizing new capital expenditure, a strategy that has resonated well with shareholders looking for disciplined growth. Similarly, Shell (NYSE: SHEL) has solidified its long-term position in the region, progressing its massive Manatee field toward a 2027 production target and greenlighting the Aphrodite project in mid-2025.
Woodside Energy (NYSE: WDS) also stands to gain significantly as it nears a Final Investment Decision (FID) on the Calypso deepwater project. With estimated reserves of 3.5 trillion cubic feet, Calypso represents the next frontier for Trinidad’s energy sector, and Woodside’s ability to navigate fiscal negotiations with the government in February 2025 has cleared the path for what could be the largest deepwater development in the nation’s history. EOG Resources (NYSE: EOG) has also seen success through its partnership in the Mento field, proving that mid-sized independent players can still find high-value opportunities in mature basins.
Conversely, the "losers" in this scenario are the net energy importers of the Caribbean, such as Jamaica and Barbados. While Trinidad has thrived on higher energy prices, these nations saw electricity costs jump by as much as 16% in early 2025. Furthermore, the National Gas Company of Trinidad and Tobago (NGC) faces the ongoing challenge of managing a "Venezuela risk." The Dragon gas field, once seen as the ultimate solution to gas shortages, remains a geopolitical hostage. As of December 31, 2025, the project is stalled due to renewed sanctions rhetoric and Venezuelan reticence, forcing the NGC to pivot back toward domestic deepwater exploration to ensure its long-term viability.
Geopolitics and the "Trump Effect" on Global Gas
The resilience of the Trinidadian energy sector is inseparable from the broader shifts in global geopolitics. The return of the Trump administration in the United States has introduced a "risk premium" to the market, particularly through the acceleration of U.S. LNG export licenses and a more aggressive stance on regional sanctions. This "Trump effect" pushed Henry Hub natural gas prices above $5.00/MMBtu in December 2025, which, while beneficial for Trinidad’s export revenues, has increased the cost of technology and infrastructure imports for local operators.
Historically, Trinidad has served as a bridge between the Americas, but the current environment has forced a strategic pivot. The nation is increasingly looking toward a "South-South" alliance, integrating its logistics and processing expertise with the meteoric rise of the Guyana-Suriname Basin. Guyana, now producing over 1 million barrels of oil per day, is the region's new economic engine, but it lacks the sophisticated downstream and LNG infrastructure that Trinidad possesses. This synergy is creating a new "energy axis" in the Southern Caribbean that is less dependent on traditional North Atlantic trade routes.
Furthermore, the CBTT’s report highlights a significant regulatory shift: the push for a "Green Energy Buffer." In 2025, Trinidad commissioned its first utility-scale renewable site, the Brechin Castle Solar project (92.2 MW). This move reflects a broader industry trend where even hydrocarbon-rich nations are diversifying their energy mix to meet international carbon standards and free up more natural gas for high-value exports. This dual-track strategy—maximizing fossil fuel extraction while building a renewable foundation—is becoming the standard for energy resilience in the mid-2020s.
The Road Ahead: 2026 and the Deepwater Frontier
Looking toward 2026, the short-term outlook for the energy sector remains positive but contingent on the outcome of the 2025 Offshore Bidding Round. With 26 deepwater blocks on the table, the government is betting that the success of the Guyana-Suriname basin will drive renewed interest in Trinidad’s unexplored depths. The potential for a "supply overhang" in the global LNG market by mid-2026, as new capacity from Qatar and Canada comes online, means that Trinidadian producers must remain low-cost and efficient to stay competitive in the Asian and European markets.
Strategic pivots will be required, particularly regarding the "Venezuela risk." If the Dragon field remains stalled, the focus will shift entirely to the Calypso and Manatee projects. Investors should watch for the Final Investment Decision from Woodside Energy (NYSE: WDS) in early 2026, as this will be the ultimate litmus test for the sector's long-term viability. Additionally, the Central Bank has signaled a "hawkish" shift for 2026, with plans to tighten the national currency supply to curb excess liquidity—a move that could impact local borrowing costs for energy service companies.
Market opportunities are likely to emerge in the "gas-to-energy" space, as regional CARICOM members seek to leverage Trinidad’s expertise to lower their own electricity costs. The development of offshore logistics hubs to support deepwater operations in the Guyana-Suriname-Trinidad triangle will also offer significant opportunities for infrastructure and service providers. However, the shadow of geopolitical volatility—particularly regarding U.S. trade policy—will continue to require a high degree of diplomatic agility from both the public and private sectors.
Conclusion: A Fortress Built on Hydrocarbons and Diplomacy
The Central Bank of Trinidad and Tobago’s year-end report serves as a powerful reminder that energy resilience is built on more than just natural resources; it requires a combination of timely project delivery, fiscal discipline, and sophisticated geopolitical navigation. By stabilizing production through strategic tiebacks and maintaining a steady monetary hand, Trinidad has managed to turn a period of global uncertainty into a moment of relative economic strength. The 11.7% surge in gas production and the successful integration of new fields like Cypre and Mento have provided the necessary "energy anchor" for the national economy.
Moving forward, the market will be defined by the transition from shallow-water "backfill" projects to the high-stakes world of deepwater exploration. While the "Venezuela risk" remains a persistent headache, the emergence of a regional energy axis with Guyana and Suriname offers a new path for growth. Investors should remain vigilant, watching for updates on OFAC licenses and the progress of the Calypso project in the coming months. As 2025 closes, Trinidad and Tobago stands as a testament to the fact that even in a fractured global order, a well-managed energy sector can still provide a foundation for national and regional stability.
This content is intended for informational purposes only and is not financial advice.
