Oil Prices Firm as US Tightens Grip on Venezuelan Crude Sales

Oil prices edged higher as markets assessed expanding US control over Venezuela’s oil sector, including plans to manage future crude sales and seize sanctioned tankers. WTI traded near $56 a barrel, while Brent remained below $60, after WTI fell 2% in the prior session. US Energy Secretary Chris Wright said Washington would begin by selling stored crude before marketing Venezuelan supply, with sales already underway. Venezuela’s PDVSA confirmed talks with the US under a framework similar to its deal with Chevron, the only US major operating in the country.

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US Starts Global Sales of Venezuelan Crude Under Expanded Control Plan

The United States has begun marketing Venezuelan crude globally after announcing it will control future oil sales following the removal of former president Nicolás Maduro. The plan covers up to 50 million barrels of oil, worth about $2.8 billion, with proceeds held in US Treasury accounts. President Donald Trump said Venezuela will use the revenue exclusively to purchase American-made products, including food, medicines and energy infrastructure equipment. Washington will selectively roll back sanctions to allow crude exports and imports of oilfield equipment, while pushing US companies such as Chevron, Exxon Mobil and ConocoPhillips to help rebuild Venezuela’s oil sector, a task estimated at $10 billion per year over the next decade. PDVSA said negotiations are ongoing under a framework similar to Chevron’s existing license.

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US Military Seizes Two Venezuela-Linked VLCCs in Major Oil Blockade Operation

U.S. forces have seized two VLCCs linked to Venezuela’s oil trade — the 318,500-dwt Marinera (formerly Bella 1) in the North Atlantic after a weeks-long pursuit, and the 320,100-dwt M Sophia in the Caribbean Sea— as part of an expanded blockade of sanctioned oil shipping. The Marinera had evaded interception in December, was renamed and reflagged to Russia, and its seizure has drawn strong criticism from Moscow as a violation of maritime law. The M Sophia, described by U.S. forces as a “stateless” sanctioned dark fleet tanker operating in international waters with Venezuelan crude aboard, is being escorted to the U.S. for disposition. These actions mark at least four tankers now seized under the U.S. “Operation Southern Spear” oil embargo targeting vessels trading with Venezuela’s oil sector. Britain provided surveillance and support in the Atlantic operation, highlighting allied cooperation in enforcing sanctions.

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Chinese Refiners Likely to Shift from Venezuelan to Iranian Crude Amid Export Halt

China’s independent refiners, known as teapots, are expected to replace Venezuelan crude with heavy Iranian oil in the coming months after Venezuelan shipments to China stopped following U.S. moves to reroute exports to the United States. With Venezuelan loadings to Asia halted since January 1, traders say ample Iranian heavy crude — priced at about $10 per barrel below ICE Brent — and Russian supply should be available, and existing Venezuelan barrels on water may cover around 75 days of demand. Other non-sanctioned crude options from Canada, Brazil, Iraq and Colombia could also be tapped if needed, but there’s limited immediate pressure to bid up prices for alternatives. Overall, the loss of discounted Venezuelan barrels is expected to pivot China’s teapots toward Iranian and other heavy crudes without sparking a sharp price scramble.

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Trump Backs Bipartisan Russia Sanctions Bill Targeting Oil Buyers

Senator Lindsey Graham said President Donald Trump has given the green light to a bipartisan Russia sanctions bill, raising hopes for a Senate vote as early as next week. The legislation would allow Trump to penalize countries buying cheap Russian oil, aiming to cut funding for Moscow’s war in Ukraine and pressure major buyers such as China, India, and Brazil. Discussions with the White House have focused on giving the president flexibility in how sanctions are applied, with broad bipartisan support suggesting easy passage if brought to a vote. The move marks a shift after months of delay, as Trump has recently voiced growing frustration with President Vladimir Putin amid stalled peace efforts.

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Iraq Moves to Nationalise West Qurna 2 Oilfield Amid Lukoil Sanctions

Iraq’s cabinet has approved the nationalisation of operations at the West Qurna 2 oilfield, one of the world’s largest, taking over from Russia’s Lukoil, which holds a 75% operating stake. Production at the field remains steady at around 465,000–480,000 bpd, accounting for about 0.5% of global supply and 9% of Iraq’s total output. The government said the move aims to avoid disruptions after Lukoil declared force majeure in November following U.S. sanctions linked to the Ukraine war. Operations will be funded through an account tied to the Majnoon oilfield, supported by crude sales from state marketer SOMO, while the Basra Oil Company covers salaries and operating costs. Sanctions have also attracted interest from roughly a dozen potential investors, including Exxon Mobil, Chevron, and Carlyle.

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Lower Tanker Rates Lift US Light Sweet Crude Prices

Falling tanker rates are boosting US crude exports, strengthening prices for light sweet grades such as WTI MEH and WTI Midland, which are at their strongest levels in about two weeks. Lower freight costs are encouraging offshore shipments, helping these grades outperform medium sour Mars Blend, which remains pressured as the US markets Venezuelan supply. Shipping rates from the US and UK to Asia have dropped sharply, easing concerns over rising domestic inventories. Although total US petroleum stockpiles hit their highest level since July 2024, analysts expect exports to reverse recent inventory builds.

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Sinokor Linked to Massive Buying and Charter Spree of Vintage VLCCs

South Korea’s Sinokor Maritime is being linked to a sweeping acquisition and chartering spree involving up to 30 VLCCs, mainly around 15 years old. Brokers say Sinokor bought about 15 VLCCs over the Christmas period and fixed or extended charters on at least 14 more, including ships from Trafigura, Koch, Mercuria and Zodiac. Belgian owner CMB.Tech confirmed the sale of six VLCCs, generating an estimated $261 million capital gain, while other reported deals include vessels priced between $56 million and $70 million. Charter fixtures reportedly include three-year deals at around $52,500 per day, levels described as high versus current spot rates. Market players see the move as a bold bet that could pay off if VLCC markets surge, but risky given the current illiquidity of older tonnage.

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Hafnia–Torm Merger Prospects Strengthen as Oaktree Loses Voting Control

A potential merger between product tanker owners Hafnia and Torm has moved closer after Oaktree Capital’s stake in Torm fell below one-third. Hafnia acquired a 13.97% stake for $311 million, cutting Oaktree’s ownership to about 27% from over 40%. As a result, Torm’s B- and C-shares, which carried enhanced voting rights including control over 350 million votes, will be redeemed and canceled, simplifying governance to a one-share-one-vote structure. Analysts say the removal of these special rights lowers barriers to strategic transactions and supports a Hafnia–Torm merger. Hafnia and Torm currently trade at similar valuations, at 0.77x and 0.79x price-to-NAV, respectively.