Trinidad Bets on Gas and U.S. Ties as Output Sags

Natural-gas output in Trinidad and Tobago has fallen 45% from its 2014 peak, leaving the country that built its prosperity on energy scrambling to refill the pipeline. Output averaged about 2.4 billion cubic feet a day in early 2026, down from a high of 4.4 billion. Energy exports still account for more than 70% of foreign-exchange earnings, according to the 2027 budget statement of Oct. 12, 2026. That’s a lot of weight resting on a shrinking base.

An Economy Tied to One Resource

The figures explain the urgency. The Central Statistical Office recorded a 0.5% contraction in 2025, while the Ministry of Finance said real output fell 1.8% in the first quarter of 2026. Inflation remains tame, averaging 0.3% in the second quarter. The budget statement attributed the gas decline to the permanent closure of Atlantic LNG Train 1 and several petrochemical plants.

The revised fiscal 2026 estimate puts the deficit at TT$7 billion, about US$1.03 billion. For fiscal 2027, the budget projects TT$59.729 billion in revenue, about US$8.82 billion, and a TT$3.639 billion deficit, equal to 2.1% of gross domestic product. Those projections assume oil at US$77 a barrel and gas at US$5.00 per million British thermal units. The budget calls these planning assumptions, not market forecasts.

The currency has remained steady. From April through August 2026, the Trinidad and Tobago dollar traded between TT$6.77 and TT$6.78 to the U.S. dollar. The central bank’s repo rate stands at 3.50%; it held US$5.3 billion in foreign assets in August, and gross official reserves covered 5.8 months of imports at the end of June.

Private Capital and New Fields

The government is counting on private operators. It expects new domestic gas from the Aphrodite and Manatee Plus fields in 2027. Manatee Plus is due to deliver first gas in late 2027, with peak production of 600 million cubic feet a day. BP’s local arm secured a licence for Loran Phase II and agreed to buy Woodside’s 70% stake in the Calypso field. Finance Minister Davendranath Tancoo said the Loran licence could allow the country to monetize potentially more than 4 trillion cubic feet of cross-border and regional gas using existing infrastructure.

There’s a catch. U.S. general licences announced Feb. 13, 2026, establish a legal framework for certain oil and gas activities in Venezuela and along the shared sea border. But taxes and royalties owed to Venezuela’s government or state oil company must go into an account designated by the U.S. Treasury. Washington revoked licences for the Dragon and Manakin-Cocuina gas fields in April 2025, then issued a six-month Dragon licence that October. The licences supporting any deal could change.

Security Partnership With Washington

Prime Minister Kamla Persad-Bissessar’s United National Congress won 26 of 41 seats on April 28, 2025, and she has closely aligned her government with the United States. The two governments signed a Status of Forces Agreement in December 2024, according to Trinidad’s Newsday. On Dec. 15, 2025, the foreign ministry approved U.S. military aircraft using Piarco and ANR Robinson airports for what Washington called logistics and personnel rotations. A U.S. radar that arrived in Tobago in November 2025 was dismantled by March 16, 2026.

Secretary of State Marco Rubio met Persad-Bissessar in Basseterre on Feb. 25, 2026, calling Trinidad and Tobago a strong U.S. partner in the Caribbean. A State Department readout said both sides reaffirmed cooperation on energy security and drug and firearms trafficking. Persad-Bissessar has publicly backed U.S. military operations in the southern Caribbean Sea, a position many CARICOM leaders didn’t share.

Trade favors Washington. In 2025, U.S. goods exports to the islands totaled US$3.12 billion, compared with US$2.68 billion in imports—a US$446 million surplus, according to the Census Bureau.

Venezuela Thaw, CARICOM Friction

Relations with Caracas collapsed in 2025. Venezuela’s National Assembly declared Persad-Bissessar persona non grata in October after she supported U.S. pressure on Nicolás Maduro’s government. U.S. forces took Maduro to New York on Jan. 3, 2026, and Delcy Rodríguez took charge in Caracas. The House of Commons Library said Washington restored diplomatic relations with her government in March and lifted sanctions on her in April.

The neighbors have moved quickly since. A Sept. 3 joint statement, issued after Foreign Minister Sean Sobers visited Venezuela, declared a new era and laid out a roadmap covering trade, energy, agriculture, the environment, culture and collective security. Persad-Bissessar and Rodríguez met in New York on Sept. 23, and the Venezuelan side indicated that Persad-Bissessar was now persona grata. They agreed to official visits, but announced no dates. On Sept. 9, Persad-Bissessar said she expected Venezuelan gas within a year, citing agreements with BP and talks with Shell. No new gas contract has been published.

Inside CARICOM, the mood is cooler. Persad-Bissessar left the February summit in Saint Kitts early, before leaders extended Secretary-General Carla Barnett’s term, and skipped a special meeting on April 10. Her government argued the reappointment breached the Revised Treaty of Chaguaramas because it wasn’t on the agenda and the Community Council had made no recommendation. Summit chair Terrance Drew said leaders had acted by the required majority. In July, leaders agreed to request an advisory opinion from the Caribbean Court of Justice. On July 28, the Court said it hadn’t received a request. Trinidad and Tobago still sends final appeals to the Privy Council, not the Caribbean Court of Justice.

Why This Matters:

Trinidad and Tobago’s finances depend on gas, and gas production is falling. Energy supplies over 70% of foreign-exchange earnings, so every delayed field or revoked licence hits the budget and the exchange rate that has held so steady. The government is betting that private operators like BP, working under U.S.-sanctioned frameworks, can restore output. That’s a market-led strategy, but it depends on decisions in Washington, including a Treasury-controlled account for Venezuelan royalties. Meanwhile, the open treaty dispute with CARICOM shows the cost of going it alone in a regional bloc. No advisory opinion, visit dates or new gas contract exist yet. Until they do, the plan remains a promise.