President Donald Trump touted the capture of Venezuelan President Nicolás Maduro as a boon for the U.S. oil industry, although experts are skeptical that U.S. control of Venezuela’s vast oil reserves will lower oil prices for Americans, at least in the short term.
Key Data
Trump said Saturday: “We’re going to make the oil flow the way it should,” telling reporters that the United States will have American energy companies produce and sell “large amounts of oil to other countries” and use the revenue generated by these transactions to strengthen Venezuela’s infrastructure.
Despite Venezuela’s strong oil supply, the country’s oil production has been slow for years due to poor infrastructure, lack of investment and mismanagement.
It could take years of positive developments for additional oil supply “to have a significant impact,” Patrick De Haan, head of oil analysis at GasBuddy, said in a statement Monday, noting that the impact of Maduro’s ouster “could ultimately be limited.”
De Haan added that the short-term impacts of Maduro’s arrest could even slightly increase oil prices due to uncertainty in Venezuela’s leadership, although he noted that a possible increase in oil production in Venezuela could reduce international crude oil prices in the long term, “especially if the United States manages to increase investment in Venezuela’s crumbling infrastructure.”
Oil prices could be “volatile” in the short term, according to Simon Wong, portfolio manager at Gabelli Funds, who said there is “a view that it will take some time for Venezuela to increase production, which I think is correct.”
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Eight countries in the Organization of the Petroleum Exporting Countries said on Sunday they will maintain a pause on oil supply increases in the first quarter of 2026 due to concerns about oversupply and declining demand, doing so amid uncertainty over the Trump administration’s plans for Venezuelan oil.
WTI crude oil closed up 1.8% on Monday, although prices have fallen 20.7% in the last year.
What are the current gasoline prices in the US?
The average price of a gallon of gasoline in the U.S. was around $2.77 on Monday, according to GasBuddy, one of the lowest prices in about four years. De Haan said he expects gasoline prices to bottom out in the coming weeks before beginning their seasonal rise around March.
Big Number
300 billion barrels. That is the estimated size of Venezuela’s oil reserves, which are the largest in the world and represent approximately 17% of global supply.
Tangent
Major oil stocks rose on Monday. Chevron, the only US company authorized to export oil from Venezuela, rose 5.1%, while Exxon Mobil rose 2.2%, ConocoPhillips 2.6% and Valero 9.2%.
Key Background
Maduro and his wife were captured by US forces early Saturday in an operation that involved more than 150 US aircraft, some of which carried out attacks in northern Venezuela. Maduro and his wife pleaded not guilty to drug trafficking charges in New York on Monday. The Venezuelan president faces life in prison if convicted. Venezuelan Vice President Delcy Rodríguez has taken over from Maduro and is “cooperating,” according to Trump, who on Monday claimed that Rodríguez would “pay a very high price” if he does not “do the right thing.”
This article was originally published on Forbes US
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