Oil Markets on Edge: OPEC+ Holds Firm Amid Venezuelan Turmoil

WikiFX

| 2026-01-05 11:00

Abstract：Geopolitical risk premiums in crude markets remain elevated as OPEC+ signals steady output policy while US military intervention in Venezuela triggers regional instability, potentially stalling production recovery.

Global crude benchmarks Brent and WTI face a complex week ahead as supply-side constraints clash with geopolitical shocks. While OPEC+ appears poised to maintain its current production caps, the sudden US military intervention in Venezuela has added a new layer of uncertainty to global energy flows.

OPEC+ Consensus: Stability Over Volume

Delegates from the OPEC+ alliance indicate that the group is highly likely to keep its current oil output policy unchanged at Sunday's meeting. Despite political friction between key members Saudi Arabia and the UAE regarding Yemen, the collective priority remains managing market surplus.

Production Context: Five key members have already delayed planned production hikes until April 2025.

Market Pressure: With oil prices down over 18% in the past year, the cartel is prioritizing price floors over regaining market share.

Venezuela: The Supply Illusion

The recent US military raid in Caracas and the detention of President Maduro has sparked speculation regarding a potential return of Venezuelan crude to global markets. However, energy analysts caution against expecting an immediate supply flood.

Hesitant Majors: Despite calls from Washington for investment, major firms like ConocoPhillips and ExxonMobil remain cautious. Chevron, currently the only US major active in the region, is prioritizing asset security over expansion.

Infrastructure Reality: Years of underinvestment mean Venezuela is unlikely to ramp up production significantly from its current 900,000 bpd level in the near term, keeping global spare capacity tighter than headline figures suggest.

Market Outlook

Traders should monitor CAD for volatility correlated with oil price swings. While the geopolitical risk premium provides support, the lack of immediate investment commitment in Venezuela and OPEC's conservative stance suggests prices may remain range-bound, capped by demand-side concerns in China and Europe.