Assessment of the Impact of US Actions in Venezuela on Global Oil Supply and Prices

In early January 2026, the US took unprecedented tough measures against Venezuela:

• Military Action
  : On January 3, US forces forcibly took control of Venezuelan President Maduro and his wife and transferred them to the United States[1]
• Oil Blockade
  : The US imposed an oil embargo on Venezuela, blocking tanker transportation and preventing crude oil from being exported[1]
• Economic Sanctions
  : The US continued to implement the “oil isolation” measure to pressure Venezuela to change its policies[2]

According to the latest data, Venezuela’s oil industry has been severely impacted:

• Plummeting Exports
  : From approximately 950,000 barrels per day in November 2025 to about 500,000 barrels per day after the December ban, exports are now close to zero[1,2]
• Inventory Saturation
  : More than 17 million barrels of crude oil are stranded at sea and cannot leave ports; onshore storage facilities are more than 45% full[1,2]
• Forced Production Cuts
  : Venezuela’s state oil company has cut production, with at least 200,000-300,000 barrels per day of capacity shut down[1,3]

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Indicator	Historical Peak	November 2025	Current Status
Daily Production	3.5 million barrels/day (1970s)	~1.1 million barrels/day	<800,000 barrels/day (continuing to decline)
Exports	~3 million barrels/day	~950,000 barrels/day	Near zero
Global Share	~7%	<1%	Negligible
Reserve Status	Largest in the world (~20%)	-	-

: Although Venezuela has the world’s largest proven oil reserves (~303 billion barrels), due to long-term sanctions, aging infrastructure, and poor management, actual production has plummeted from 3.5 million barrels/day in the 1970s to less than 1 million barrels/day currently, accounting for less than 1% of global supply[1,2].

Based on the latest data from EIA and IEA and forecasts from multiple institutions, the global oil market will show a

pattern in 2026:

• Supply Growth
  : Global supply is expected to grow by 2.1 million barrels/day (OPEC+ production recovery + non-OPEC production growth)
• Demand Growth
  : Only ~800,000-1.4 million barrels/day (impact of electric revolution, slowing demand growth)
• Supply Surplus
  : Expected to reach a large-scale surplus of 2 million barrels/day[4,5]

• Goldman Sachs: Brent average $56/bbl, WTI $52/bbl[5]
• JPMorgan: Brent $58/bbl, WTI $54/bbl[5]
• S&P Global: ~$60/bbl[5]
• Sinopec Economic Research Institute: $60-$65/bbl range[5]

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ANZ Bank’s core view is that the

, based on the following logic:

• Limited Supply Shock
  : Venezuela’s current exports are only ~500,000 barrels/day; even if fully interrupted, it affects less than 0.5% of global consumption (~100 million barrels/day)[3]
• Market Affordability
  : Against the backdrop of oversupply (expected surplus of 2 million barrels/day in 2026), losing 500,000 barrels/day of supply has limited price support[4,5]
• Sufficient Alternative Supply
  : U.S. shale oil and OPEC+ idle capacity (~4.02 million barrels/day) can quickly fill the gap[5]

ANZ points out that the

:

• In 2-3 years
  : If the U.S. invests “billions of dollars” to repair Venezuela’s oil infrastructure as Trump said, production may rebound to 1.5-2 million barrels/day
• After 2027
  : Will become a core bearish factor suppressing oil prices, increasing global supply pressure[3]

From market data, investors’ reactions are indeed relatively calm:

• Oil Price Performance
  : USO (United States Oil Fund) fell 3.34% during the incident period (Oct 2025-Jan 2026), indicating the market did not give a significant premium to geopolitical risks[0]
• Energy Sector
  : On Jan 5,2026, the energy sector fell by 2.64% (one of the worst-performing sectors), but XLE (Energy Select Sector SPDR Fund) actually rose by 2.72% that day, reflecting complex market sentiment[0]
• Overall Market
  : Asian and Australian markets basically “ignored” the Venezuela tensions, indicating investors believe the incident will not have a lasting impact[3]

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Indicator	USO (Oil ETF)	XLE (Energy ETF)
Period (Oct2025-Jan2026)	-3.34%	+5.49%
Current Price	$70.22	$46.89
20-day MA	$69.23	$45.04
50-day MA	$70.46	$44.86
Daily Volatility	1.60%	1.16%

:

• Oil prices (USO) are in a downward trend, trading below the 50-day MA, indicating weak short-term momentum[0]
• The energy sector (XLE) outperformed crude oil itself, mainly due to the strong performance of large oil companies
• Volatility is relatively low, indicating the market is not overly panicked

An important market shift is happening:

.

In 2025, despite multiple major geopolitical events (Iran-Israel attacks, Russia-Ukraine conflict, Red Sea crisis, Venezuela crisis), Brent crude fell from nearly $80/bbl at the start of the year to about $60/bbl at the end, forming a clear “gradual decline” curve[5]. This indicates:

1. Supply Flood
   : OPEC+ gradually exiting production cuts, U.S. shale oil resilience, Brazil/Guyana production growth
2. Weak Demand
   : Slowing global economic growth, accelerating electric revolution, energy efficiency improvements
3. Risk Premium Failure
   : The market is shifting from “geopolitical pricing” to a new phase of “supply-demand fundamental pricing”[5]

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Company	Period Gain	Current Price	52-Week High
ExxonMobil (XOM)	+11.37%	$125.36	$125.93
Chevron (CVX)	+5.83%	$163.85	$165.75
Energy ETF (XLE)	+5.49%	$46.89	$47.41

:

• Quality Companies Outperform
  : ExxonMobil significantly outperformed crude oil prices, reflecting its high-quality assets and strong balance sheet advantages
• Defensive Nature Highlighted
  : In a weak oil price environment, large integrated oil companies show stronger resistance to declines
• Sector Rotation
  : On Jan5,2026, the energy sector was one of the worst-performing sectors (-2.64%), indicating capital may be flowing out[0]

Based on a comprehensive analysis of the Venezuela incident and the global oil market, here are the key implications for energy stock investments:

1. Focus on Defensive Leaders
   • Large integrated companies like ExxonMobil (XOM) and Chevron (CVX) have stronger resilience
   • These companies can hedge against upstream oil price decline risks through downstream refining and chemical businesses
   • Strong balance sheets support dividends and buybacks

2. Beware of Geopolitical Hype
   • Geopolitical events like Venezuela may trigger short-term trading opportunities, but sustainability is limited
   • Do not overweight energy stocks based on a single geopolitical event
   • Focus on fundamentals rather than headline news

3. Focus on Refining and Downstream Businesses
   • Falling crude oil prices are conducive to expanding refining margins
   • Independent refiners may benefit from the low crude oil cost environment

1. Increasing Structural Differentiation
   • Winners
     : Companies with low production costs, strong balance sheets, and diversified businesses
   • Losers
     : High-cost producers, over-reliance on single assets, high financial leverage
   • Industry consolidation may accelerate, with quality companies acquiring undervalued assets

2. Long-Term Impact of Venezuela
   • After 2027
     : If the U.S. successfully repairs Venezuela’s oil infrastructure, production may rebound significantly (potential up to 2-3 million barrels/day)
   • This will become a long-term oil price suppression factor, but companies like Chevron that have established presence in Venezuela may benefit[3]

3. Accelerated Energy Transition
   • The low oil price environment may accelerate new energy substitution, suppressing traditional oil demand in the long term
   • Focus on integrated energy companies transitioning to clean energy

Strategy	Recommended Targets	Reasons
Core Holdings	XOM, CVX	Integrated advantages, strong balance sheet, dividend safety
Cyclical Opportunities	Independent refiners	Benefit from low crude oil costs and margin expansion
High Elasticity	Quality E&P companies	Have cost advantages and large production growth potential
Diversified Allocation	XLE ETF	Diversify individual stock risks and capture sector beta returns

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The U.S. military actions and oil blockade in Venezuela have

, consistent with ANZ Bank’s analysis. Main reasons:

1. Too Small Scale
   : Venezuela’s current exports (<500,000 barrels/day) are negligible compared to the global market (100 million barrels/day)
2. Loose Market
   : Global surplus is expected to reach 2 million barrels/day in2026, fully capable of absorbing this supply interruption
3. Sufficient Alternatives
   : OPEC+ idle capacity, U.S. shale oil, strategic petroleum reserves, etc., can quickly fill the gap

The real investment implication lies in the

:

• In2-3 years
  : If the U.S. really invests heavily to repair Venezuela’s oil infrastructure as Trump promised, production may rebound from less than 1 million barrels/day currently to 2-3 million barrels/day
• After2027
  : This will become a core factor suppressing oil prices, increasing global supply pressure, but may also create value for companies like Chevron that have established presence in advance
• Structural Change
  : The oil market is shifting from the old paradigm of “geopolitical premium pricing” to a new one of “supply-demand fundamental pricing”

For energy stock investors, the following strategies are recommended:

1. Focus on Fundamentals
   : Choose companies with low costs, strong balance sheets, and diversified businesses
2. Ignore Noise
   : Do not adjust positions significantly due to short-term geopolitical events
3. Focus on Long Term
   : Pay attention to structural trends like energy transition and industry consolidation
4. Dynamic Balance
   : Adjust allocations dynamically based on oil price cycles and company valuations

In the current oversupplied low oil price environment,

. Industry leaders like ExxonMobil and Chevron, with their integrated advantages and strong financial conditions, can maintain competitiveness during industry downturns and achieve outperforming returns when the industry recovers.

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[1] Xinhuanet - “U.S. Blockade Continues, Venezuela Prepares to Cut Oil Production” (Jan5,2026)
https://www.news.cn/world/20260105/2d0440926e244e7894e7d4d31f57835a/c.html

[2] Shangguan News - “Venezuela Forced to Cut Crude Oil Production Due to U.S. Blockade” (Jan4,2026)
https://www.shobserver.com/staticsg/res/html/web/newsDetail.html?id=1047004&sid=11

[3] Wallstreetcn - “After Trump’s Action, Why Is Venezuela’s Oil Still Hard to Resume Production Quickly?” (Jan5,2026)
https://wallstreetcn.com/articles/3762578

[4] ING Think - “Bearish oil outlook, but upside risks abound” (Dec2025)
https://think.ing.com/articles/bearish-oil-outlook-but-clear-upside-risks/

[5] Jiemian News - “Global Crude Oil Prices Will Be Below $65 in2026” (Dec30,2025)
https://news.qq.com/rain/a/20251230A06GCC00

[6] Sina Finance - “Crude Oil Expected to Show a ‘First Decline Then Rise’ Trend in2026” (Dec23,2025)
https://finance.sina.com.cn/money/bond/2025-12-23/doc-inhctsyv5648623.shtml

[7] Reuters - “US oil refiners win, Chinese rivals lose in Trump’s Venezuela strike” (Jan4,2026)
https://www.reuters.com/markets/commodities/us-oil-refiners-win-chinese-rivals-lose-trumps-venezuela-strike-2026-01-04/

[8] ABC News - “Oil prices fall after US strikes on Venezuela, ASX flat” (Jan5,2026)
https://www.abc.net.au/news/2026-01-05/asx-markets-business-live-news-jan05-2026/106198892

[9] Jinling API Data - Stock prices, market indices, sector performance data (Jan6,2026)

[10] OPEC - Monthly Oil Market Report (Dec2025)
https://publications.opec.org/momr