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Arrest of Venezuelan president unlikely to impact oil prices immediately, analysts say

Published: 04 Jan. 2026, 18:24

U.S. President Donald Trump speaks during a news conference at the Mar-a-Lago Club in Palm Beach, Florida, on Jan. 3. Venezuelan President Nicolas Maduro has been charged in the United States after he was captured and flown out of Venezuela, following a series of airstrikes that mark an extraordinary escalation in the Trump administration's months-long campaign against the country. [EPA/YONHAP]

The arrest of Venezuelan President Nicolás Maduro by the United States has emerged as a major geopolitical development — not only for Latin America but also for the global oil market. Washington’s underlying motive of placing the world’s largest oil reserves under U.S. influence may have become increasingly apparent, but analysts say the move is unlikely to have an impact on oil prices right away.

"We're going to have our very large United States oil companies, the biggest anywhere in the world, go in, spend billions of dollars, fix the badly broken infrastructure, the oil infrastructure, and start making money for the country," U.S. President Donald Trump said Saturday.

The Financial Times noted that the boldness of the move was amplified by the fact that Trump all but admitted oil was the motive within hours of Maduro’s arrest. Since taking office, Trump has pursued a low-oil-price policy aimed at controlling inflation and boosting the competitiveness of U.S. manufacturing.

Observers say Maduro’s ouster is part of a broader U.S. energy strategy — one that ultimately seeks to reintegrate Venezuelan crude into global supply chains to prevent a sharp rise in oil prices.

Venezuela holds about 303 billion barrels of crude oil reserves — 17 percent of the global total — making it the world's largest. However, its current daily output is less than 1 million barrels, accounting for just 1 percent of global supply. Since former President Hugo Chávez came to power in 1999, sweeping nationalization of the oil industry and expropriation of foreign assets have drastically reduced production and exports. The country’s top export destination is China, which receives roughly 80 percent of its crude shipments.

International oil prices fell by about 20 percent last year due to rising supply. On Jan. 2, before the arrest, West Texas Intermediate (WTI) crude closed at $57.30 per barrel, and Brent crude at $60.80 — about half the price seen in 2022 when Brent surged past $120 following Russia’s invasion of Ukraine.

An oilfield worker walks next to drilling rigs at an oil well operated by Venezuela's state oil company PDVSA, in the oil rich Orinoco belt, near Morichal at the state of Monagas, April 16, 2015. [REUTERS/YONHAP]

The Guinea-flagged oil tanker MT Bandra, which is under sanctions, is partially seen alongside another vessel at El Palito terminal, near Puerto Cabello, Venezuela, on Dec. 29, 2025. [REUTERS/YONHAP]

Analysts expect excess supply to continue dragging down oil prices in 2026. The International Energy Agency IEA forecasts that global oil supply will exceed demand by an average of 3.8 million barrels per day. OPEC+, the coalition that includes Venezuela and Russia, is scheduled to meet on Sunday and is widely expected to maintain its current production limits.

Foreign media outlets say oil prices could rise slightly in response to the current situation, though not due to supply disruptions but rather geopolitical risk. Reuters, citing sources, reported that the state-owned Venezuelan oil company PDVSA's core production and refining facilities had not suffered major damage.

Brent crude may climb by $1 to $2 or even less — a level of disruption manageable under normal market conditions — on the evening of Sunday, according to Arne Lohmann Rasmussen, chief analyst and head of research at A/S Global Risk Management. Vandana Hari, CEO of energy consultancy Vanda Insights, added that the immediate impact on the oil market would be minor, with only a slight increase in Venezuela-related risk premiums.

For now, logistics and export restrictions are more pressing concerns than production. Trump said the U.S. embargo on Venezuelan oil remains in effect. If sanctions are lifted and foreign investment resumes following regime change, Venezuela’s exports could eventually reach 3 million barrels per day, according to Saul Kavonic, an analyst at MST Marquee.

Venezuela's then acting President Nicolas Maduro holds a farm worker's hat with the figure of a bird perched on the hat's crown during a presidential election campaign rally in Catia La Mar, Venezuela, on April 9, 2013. Maduro assured during a campaign rally that the late President Hugo Chavez appeared to him as a ″very small bird″ to give him his blessing. [AP/YONHAP]

Protesters gather to denounce the U.S. attack on Venezuela on Jan. 3 in Las Vegas. [AP/YONHAP]

Analysts believe the recent reduction in Venezuelan crude supply has helped support oil prices, and if exports normalize following Maduro’s arrest, one of the key support factors for oil prices could disappear, according to an analysis by the Wall Street Journal.

Despite growing expectations that U.S. oil companies could benefit, the path to restoring Venezuela’s oil industry will be long and costly. Industry experts estimate that full recovery will take years and tens of billions of dollars. Energy consulting firm Rystad Energy forecasts that restoring output to 2 million barrels per day would require over $100 billion in investment.

"There are still many questions that need to be answered about the state of the Venezuelan oil industry, but it is clear that it will take tens of billions of dollars to turn that industry around," said Peter McNally, global head of sector analysts at Third Bridge, as cited by Reuters.

"Unless there's a very smooth transition, which I don't think is likely to happen, we're probably going to see an increase in prices of less than $5 per barrel, let's say $2 to $3 per barrel, on Monday and next week," said Jorge León, head of geopolitical analysis at Rystad Energy.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY PARK YU-MI [[email protected]]