The price of crude oil fell in early Asian trading on Monday, January 5th, indicating that despite the capture of Venezuelan President Nicolas Maduro by the United States leading to political turmoil in the country, the ample oil supply has not had a significant impact on oil prices.
On Monday, international oil prices fluctuated, maintaining a sideways consolidation pattern. Sideways consolidation refers to when the prices of stocks, indexes, or other financial assets remain relatively stable over a period, forming a horizontal price range without a clear upward or downward trend.
As of 11:08 GMT (6:08 pm Eastern Time on Sunday), global benchmark Brent crude futures fell by 34 cents to $60.41 per barrel, a decrease of 0.56%; while U.S. benchmark West Texas Intermediate (WTI) crude oil prices dropped by 41 cents to $56.91 per barrel, a decrease of 0.72%.
By 00:24 GMT, Brent crude futures rose by 17 cents to $60.92 per barrel, recovering some of the early losses; U.S. West Texas Intermediate crude oil was priced at $57.43 per barrel, up 11 cents.
The U.S. captured the authoritarian Venezuelan President Maduro and his wife Cilia Flores from the capital Caracas early Saturday. President Trump later stated that the U.S. would temporarily manage the country until its regime is secure and undergoes a proper transition.
Trump also mentioned on Saturday that the U.S. sanctions on Venezuelan oil remain effective.
Venezuela holds the largest proven oil reserves in the world. Previously, there were concerns that the political turmoil in Venezuela, a member of the Organization of the Petroleum Exporting Countries (OPEC), would impact oil transportation.
However, two sources familiar with the operations of Venezuela’s state-run oil company PDVSA told Reuters over the weekend that the latest U.S. actions against Venezuela have not harmed the country’s oil production and refining industry.
The oil production alliance comprising the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, held its monthly meeting on Sunday and decided to maintain oil output unchanged.
Analysts point out that the global oil market has sufficient supply, indicating that even if Venezuelan crude oil exports are further hindered, it will not immediately affect oil prices.