Oil prices traded slightly higher Monday morning, up 55c to $57.87/Bbl (8:00 AM CT) for WTI amid President Maduro’s capture
The US carried out a grab operation early Saturday morning and captured Venezuela’s President Maduro
The Trump administration have been ratcheting up pressure on the Maduro regime with a vessel blockade that targeted Venezuela’s oil exports
The South American country’s exports fell to a 17-month low in December due to the US blockade (Bloomberg)
According to Kpler data, many of those vessels were loaded with crude but never left Venezuelan waters due to threat of seizure
The unknown for the oil market is how oil flows from Venezuela will change due to US actions
The US said the navel blockade remains in place despite capturing Maduro
AEGIS notes that in the short-term, geopolitical risk have been heightened putting slight upward pressure on crude oil prices. However, if oil is allowed to flow at pre-blockade levels then this is net bearish prices in the short-term. For reference, Venezuela accounted for only 1% of global crude production and many analysts see volumes returning to pre-blockade levels
Analysts opine on Venezuela’s oil production future (Bloomberg)
Oil analysts see upside risk to Venezuela’s supply over the long run
The scope for higher Venezuelan oil out in the long run may eventually pressure global crude prices (Goldman Sachs)
Regime change in Venezuela would be on the of the largest upside risks to global oil supply in the long run (JPMorgan)
Consensus is that there will have to be anywhere from $50-$100 billion invested into Venezuela to return the nation to its former production glory – not a short-term task
Natural gas trades sharply lower on weak near-term demand
The February Henry Hub contract is down nearly 20c this morning, extending losses from Friday (8:10 AM)
Lower-48 population-weighted average temperatures are forecast to be well-above the ten-year average this week, resulting in reduced gas demand
After this week, temperatures are forecast to return to levels closer to the ten-year average
Last week, the EIA released two gas storage reports, with Lower-48 gas inventories now 58 Bcf above the five-year average after briefly falling below average
Banks lower 2026 Henry Hub price forecast (NGI)
A compilation of price forecasts from 29 banks compiled by Haynes Boone showed that while long-term price expectations remain strong, near-term forecasts have been revised lower
The overall average price forecast for 2026 now sits at $3.43/MMbtu, slightly lower than the previous average
While gas demand has risen this year, production has also reached a new record high, contributing to the weaker expectations for 2026 prices
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