S&P International Power’s forecast stays unchanged by Venezuela developments, an evaluation piece despatched to Rigzone by the S&P International crew late Monday acknowledged.
The evaluation piece – by Jim Burkhard, Vice President and International Head of Crude Oil Analysis, and the S&P International Power Crude Oil Markets crew – outlined that S&P International Power remains to be projecting a 1.4 million barrel per day world crude oil inventory construct within the first quarter of this 12 months. The evaluation additionally outlined that S&P International Power remains to be calling for Dated Brent to common $60 per barrel.
“Nonetheless, there might be a extra discernible impression on the heavy bitter crude oil market,” the evaluation piece acknowledged.
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“Venezuela accounts for one % of worldwide crude oil manufacturing however roughly 9 % of the world’s 9 million barrels per day of heavy crude oil manufacturing. The US and China are the world’s largest markets for heavy crude oil,” it added.
“International heavy crude/heavy residual feedstock markets are at present narrowly balanced. Greater provide can be bearish for heavy bitter crude differentials and high-sulfur gas oil (HSFO) cracks. Decrease provide can be modestly bullish,” it continued.
The evaluation piece acknowledged that, in 2025, Venezuela produced a median of 826,000 barrels per day of crude oil, excluding imported diluent that’s blended into home manufacturing. Crude oil exports, together with blended diluent, averaged 750,000 barrels per day, based on the evaluation.
“Earlier than Jan. 3, S&P International Power had already assumed a discount in provide from Venezuela as a consequence of U.S. efforts to curtail exports on sanctioned oil tankers, and the view stays the identical,” the evaluation famous.
“Whereas S&P International Power sees threat to the upside and draw back when it comes to manufacturing and exports, it’s not sufficient both method to considerably alter the worldwide oil steadiness within the first quarter,” it added.
“If sanctions had been eliminated, Venezuelan oil manufacturing might develop however it could require not less than a number of billion {dollars} or extra of contemporary funding to spice up marketed manufacturing to 1.5 million barrels per day within the subsequent 12-24 months – a rise of roughly 500,000 barrels per day from latest ranges (together with blended diluent),” it continued.
Within the evaluation piece, Burkhard acknowledged that latest developments in Venezuela do little to change the truth that the worldwide oil market is going through a surplus at the beginning of 2026.
In a press release despatched to Rigzone by the Morningstar crew late Monday, which targeted on the Venezuela state of affairs, Morningstar’s director of fairness analysis, Joshua Aguilar, stated, “we don’t plan to change our truthful worth estimates or our midcycle oil value estimates of Brent $65 per barrel and WTI $60 per barrel”.
“Whereas vital Venezuelan provide will increase to world markets might be bearish for our 10-year forecast, we predict it is going to take years for provide to meaningfully improve,” he added.
“Venezuela would require years of enormous capital investments to modernize its infrastructure,” he continued.
In a remark despatched to Rigzone early Tuesday, Aaron Hill, Chief Market Analyst at FP Markets, famous that the “Venezuela disaster set off[ed]… [a] rally in commodities”.
“Crude markets … discovered help, with WTI rallying almost 2.0 % because the intervention forged contemporary uncertainty over entry to grease reserves,” Hill stated.
In a press release despatched to Rigzone on Monday morning, Naeem Assam, Chief Analyst at Zaye Capital Markets, famous that “oil stays vary certain, with Brent close to $60.9 per barrel and WTI round $57.4 per barrel, underscoring that macroeconomic weak point is outweighing geopolitical threat”.
“Regardless of U.S. actions tied to Venezuela and rhetoric from Donald Trump concerning management of Venezuelan oil property below Nicolas Maduro, value response has been muted – clear proof of headline exhaustion,” he added.
In a information convention held on January 3 in Mar-a-Lago, Florida, which was streamed by Sky Information, U.S. President Donald Trump acknowledged, “late final evening and early at the moment, at my course, america Armed Forces performed a rare army operation within the capital of Venezuela”.
To contact the writer, e mail andreas.exarheas@rigzone.com
