Oil Gains $1 as Markets Weigh Venezuela Supply Risks After Maduro’s Capture

Oil prices settled about $1 a barrel higher as traders assessed potential disruptions to crude flows from Venezuela following the U.S. capture of President Nicolas Maduro. Brent crude rose $1.01, or 1.66%, to $61.76 a barrel, while U.S. WTI gained $1, or 1.74%, to $58.32, after a volatile session that earlier saw prices fall more than $1. Venezuela, which holds the world’s largest oil reserves, has seen output collapse to around 1 million bpd last year, roughly 1% of global supply, due to years of mismanagement and underinvestment. Analysts said uncertainty over whether U.S. actions could eventually lift the naval blockade and sanctions is the key unknown, with expectations that any recovery in production would take time, even if Venezuelan oil currently stuck at sea or in storage re-enters the market. Broader geopolitical risks also supported prices, as President Donald Trump warned of possible further U.S. interventions elsewhere, while OPEC and its allies agreed to maintain their current output levels.

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Chevron Resumes Venezuela Operations as Limited Oil Exports Restart

Chevron is calling about 20 employees back to Venezuela as it resumes crude exports to the U.S., seeking to stabilize operations amid ongoing political turmoil. A Chevron-chartered tanker carrying roughly 300,000 barrels of Venezuelan heavy crude departed on Monday for the U.S. Gulf Coast, marking the first export since Jan. 1, according to shipping data. Chevron, the only U.S. oil major authorized to operate and export from Venezuela despite sanctions, is currently producing about 240,000 bpd at its Petropiar and Petroboscan projects, near capacity, with storage still available to avoid output cuts. This contrasts with state oil firm PDVSA, which is struggling with mounting inventories and has pressured joint ventures to curb production after exports largely stalled since mid-December. PDVSA has managed to ship about a dozen sanctioned tankers carrying Venezuelan oil and fuel in early January despite the U.S. blockade, though the vessels’ destinations remain unclear.

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Sanctioned Tankers Slip Out as Venezuela Ships Oil Despite US Blockade

About a dozen sanctioned tankers carrying an estimated 12 million barrels of Venezuelan crude and fuel have left the country’s waters since the start of the year despite a U.S. export blockade imposed in mid-December. Many of the vessels, including several supertankers typically bound for China, are sailing without clear flags or valid safety documentation, with some departing in “dark mode” after Venezuelan authorities cleared them to leave. U.S. President Donald Trump said the oil embargo remains fully in force following the capture of President Nicolas Maduro, though he added that major customers such as China would continue receiving Venezuelan oil. The blockade had stalled PDVSA’s exports, forcing the company to cut output after filling onshore storage and leaving more than 20 million barrels stranded on ships. In contrast, Chevron, the only company exempt from sanctions, resumed exports on Monday with a tanker carrying about 300,000 barrels of Venezuelan heavy crude to the U.S. Gulf Coast.

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China Reaffirms Venezuela Ties Despite US Intervention

China said its cooperation with Venezuela will remain unchanged following the capture of President Nicolas Maduro, even as US actions threaten to reshape global crude flows. China accounted for about 45% of Venezuelan crude shipments in 2025, but potential US control could divert oil toward American refiners and alter tanker routes and vessel demand. Foreign ministry spokesman Lin Jian said Beijing respects Venezuela’s sovereignty, opposes interference, and will continue deepening practical cooperation while protecting China’s legitimate interests under the law. He added that China will remain a reliable partner to Latin America and the Caribbean, pursuing equality and mutual benefit without seeking spheres of influence. Lin stressed that countries in the region have the right to choose their own development paths and partners amid a changing international landscape.

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China’s investment in Venezuela’s oil industry

China is a major buyer and investor in Venezuela’s oil industry, importing about 470,000 bpd in 2025—around 4.5% of its seaborne crude imports—often via rebranded shipments and mainly through small “teapot” refiners buying discounted crude. Venezuela’s production has fallen to roughly 1.1 million bpd last year from a peak of about 3.5 million bpd in the late 1990s due to mismanagement, underinvestment and U.S. sanctions. Chinese firms invested about $2.1 billion in Venezuela’s oil sector after 2016, with CNPC and Sinopec holding stakes in joint ventures controlling a combined 4.4 billion barrels of reserves, though CNPC halted direct liftings in 2019. Some oil shipments also help repay Venezuela’s debt to China, estimated at over $10 billion. Private Chinese firms have announced or received contracts potentially targeting up to 60,000 bpd of output by 2026, but the status of several projects remains unclear.

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Trump Signals Possible Tariff Hike on India Over Russian Oil Imports

U.S. President Donald Trump warned that Washington could swiftly raise tariffs on India if it does not further curb purchases of Russian oil, adding pressure as trade talks remain unresolved. The threat follows last year’s doubling of U.S. tariffs on Indian goods to 50%, partly linked to Russian crude, with Senator Lindsey Graham backing proposals for tariffs of up to 500% on countries continuing such imports. Indian markets reacted, with the IT index falling about 2.5%, while analysts say India has reduced but not fully halted Russian oil buying, leaving it in a “strategic grey zone.” Indian exports to the U.S. fell more than 20% between May and November 2025 despite a November rebound, prompting New Delhi to seek a deal while collecting weekly data on Russian and U.S. oil imports.

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Saudi Arabia Lowers Arab Light Prices Again as Global Oil Glut Looms

Saudi Arabia cut the official selling price of its flagship Arab Light crude to Asia for a third straight month, reducing it to a 30-cent-per-barrel premium to the regional benchmark for February amid persistent oversupply concerns. The move comes even as OPEC+ agreed to pause supply increases in the first quarter, with delegates saying Venezuela was not discussed and its impact on supply remains unclear. Global crude prices fell about 20% last year, with Brent suffering its worst annual decline since 2020, while the International Energy Agency forecasts a surplus of roughly 3.8 million bpd in 2026. Weakening Middle East crude markets, rising output from rival producers, and a gloomy demand outlook from top importer China continue to pressure prices despite ongoing geopolitical risks involving Russia, Iran, and Ukraine.

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Canadian Heavy Crude Hits One-Year Low as Venezuela Shock Raises Supply Fears

Canadian heavy crude prices fell to a one-year low as markets reacted to the US-led capture of Venezuelan President Nicolás Maduro and the possibility that sanctioned Venezuelan oil could re-enter global markets. Cold Lake crude’s discount to WTI widened to $7.25 a barrel at Cushing and to $13.40 in Alberta, the weakest levels in over a year, while shares of major Canadian oil sands producers declined. Since the US seized tankers including the Skipper, more than 15 million barrels of Venezuelan oil have been loaded and blocked, with about 9 million barrels sitting in floating storage near China. Analysts said only a rapid recovery in Venezuelan output or diversion of crude from China to open markets would meaningfully pressure Canadian heavy crude prices in the near term.

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Phillips 66 Buys Lindsey Refinery Assets, Rules Out Restart

U.S. refiner Phillips 66 agreed to acquire the assets and infrastructure of Britain’s Lindsey oil refinery in northern England following its liquidation, integrating them into its nearby Humber Refinery, but did not disclose the deal value. The Lindsey refinery, which closed in July last year after former owner Prax fell into insolvency, put about 420 jobs at risk, with 250 staff currently guaranteed employment only until the end of March. Phillips 66 said it will not restart standalone refining operations at Lindsey, judging the site unviable in its current form, and instead plans to use storage and infrastructure assets to improve supply flexibility and support traditional and renewable fuel production at Humber. The UK government said the move would boost domestic energy security and create hundreds of construction jobs over the next five years.

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Alternative-Fuel Ship Orders Slip in 2025 as Uncertainty Persists

Newbuilding orders with alternative-fuel capability declined in 2025 amid regulatory stalling, fuel pricing challenges and limited infrastructure, with 499 vessels totaling 41.1m gt contracted, accounting for 37% of annual tonnage, down from 45% in 2024, Clarksons Research said. Despite the slowdown, alternative fuels still represent 47% of total orderbook tonnage, only slightly below last year, and Clarksons expects over 20% of global fleet capacity to be alternative-fuel capable by 2030. LNG remained the dominant choice, making up 80% of alternative-fuel tonnage ordered, as concerns persist over methanol and ammonia availability and bunkering. Container ships continued to lead adoption, with 62% of capacity alternative-fuel capable, supported by favorable market structures and trading patterns. While deliveries hit a record in 2024, Clarksons warned that investment in port infrastructure and the supply of green fuels continue to lag, tempering near-term growth.