Oil Prices Slide After U.S. Ousts Venezuela’s Maduro, Sparking Market Reaction

Global crude oil prices fell on Monday as financial markets reeled from the United States’ military operation that removed Venezuelan President Nicolás Maduro from power, fueling speculation over future oil supply and market dynamics.

In early Asian trading, Brent crude dipped around 0.2% to about $60–61 per barrel, while U.S. West Texas Intermediate (WTI) also weakened by roughly 0.3–0.5%, retreating from earlier levels. Analysts linked the downward movement to traders pricing in the possibility of increased Venezuelan oil volumes entering the market over the longer term, a factor that could add to an existing global oversupply.

Market Dynamics Amid Venezuela Turmoil

The price slide comes amid intense geopolitical upheaval following the U.S. military’s seizure of Maduro and his wife in Caracas over the weekend, with both leaders transported to the United States to face federal charges. President Donald Trump has since outlined plans for U.S. involvement in Venezuela’s transition period, including potential engagement by U.S. companies in the country’s oil sector.

Venezuela sits atop the world’s largest proven crude oil reserves, yet its current production estimated at around one million barrels per day after years of underinvestment and sanctions remains far below historical highs of about 3.5 million barrels per day.

While the nation’s oil infrastructure is badly deteriorated and far from a quick turnaround, markets nonetheless reacted to the prospect of future output expansion and reintegration into global supply chains under new governance or foreign investment.

Short-Term Price Moves and Mixed Signals

Despite the overall drop, early trading saw some volatility as investors weighed conflicting signals from financial markets. Precious metals such as gold surged as investors sought safe havens amid geopolitical uncertainty, while equity markets exhibited mixed reactions, with Asian stocks opening higher before later fluctuations.

Some analysts have emphasized that, in the short term, Venezuela’s subdued oil output and existing sanctions mean any potential increase in supply remains speculative and won’t immediately flood global markets. This has led to contrasting price movements, with oil briefly rising before ultimately slipping as sentiment evolved.

Oversupply Concerns and Broader Market Context

Oil prices had already been under pressure in recent months due to ample global supply and lacklustre demand, contributing to a broader downturn in crude markets. Traders have pointed to forecasts of continued oversupply in 2026, with Venezuelan crude even at moderate production adding to market anxiety about price stability.

Analysts also note that logistical and technical challenges in reviving Venezuela’s oil production including severe infrastructure decay and the need for significant investment may temper expectations of rapid output gains. Without major production increases, the immediate effect on prices could be limited.

Investor Caution and Future Outlook

Global markets remain cautious as governments, investors, and energy companies assess the implications of Venezuelan political developments. In the near term, price swings are likely as traders balance geopolitical risk factors against fundamentals like supply, demand, and OPEC+ production strategies.

As the situation evolves including how U.S. involvement in Venezuela’s oil industry unfolds energy markets could see continued volatility, underlining the complex interplay between geopolitics and crude prices in the early weeks of 2026.