Following the U.S. military operation on January 3 and the capture of President Nicolás Maduro, Venezuela’s oil exports have come to a near-complete halt. This development not only poses a significant shock to Venezuela’s economy but also introduces new uncertainties regarding the political transition and the global energy market.
A key question is how this may affect global oil supply and prices.
According to reports, recent developments have paralyzed Venezuela’s crude oil export operations entirely. No departure authorizations have been issued following tightened U.S. controls on oil tankers. As a result, numerous tankers remain idle at ports, particularly those scheduled for destinations in the United States and Asia, while others have been forced to leave ports empty. This disruption has raised concerns, given that, according to data from the International Energy Agency (IEA), Venezuela holds the world’s largest proven crude oil reserves of approximately 303 billion barrels, accounting for about 17% of global reserves.
Global Oil Market Expected to Experience Only Limited Volatility
Despite the ban on Venezuelan oil exports, experts assess that the immediate impact on global oil prices is expected to remain limited.
Although Venezuela possesses one of the world’s largest oil reserves, its extraction capacity falls far short of its potential. Due to insufficient investment, economic crisis, and the effects of sanctions, Venezuela’s oil production has declined from a previous peak of 3.5 million barrels per day to approximately 1 million barrels per day, equivalent to about 0.8% of global production with daily exports of around 500,000 barrels. Consequently, most experts and analysts concur that crude oil prices are unlikely to experience significant volatility in the short term. Some specialist opinions suggest that the disruption to Venezuelan supply could result in a short-term increase of only 1-2 USD per barrel for Brent crude, and it is unlikely to reverse the prolonged downward trend in global oil prices.
The primary reason is the current oversupply in the global oil market, with Venezuela contributing less than 1% of global supply amid excess production from OPEC+ and record output from the United States.
On a global scale over the past year, oil prices have faced downward pressure of nearly 20%, driven by oversupply as OPEC+ members have tended to increase production. The United States, the world’s largest oil producer, has also achieved record extraction levels exceeding 13.8 million barrels per day.
This event, similar to previous geopolitical developments such as conflicts in the Middle East or Ukraine, is unlikely to exert substantial influence on oil prices, which remain dominated by the prevailing supply exceeding demand. Many views suggest that once geopolitical tensions resolve, Venezuelan oil production could rebound to 3 million barrels per day within a few years, further contributing to downward pressure on prices.
However, such prospects remain distant, as Venezuela’s pipeline system has not been upgraded in 50 years, and the cost of restoring maximum capacity is estimated at 58 billion USD. The capture of President Nicolás Maduro on January 3 has immediately halted all crude oil export activities in the country. Shipments have ceased entirely, leaving port authorities in a state of indefinite waiting.
Operations at strategic oil hubs have virtually ground to a halt. Notably, even transports involving U.S. oil company Chevron and Venezuela’s PDVSA have been frozen. Industry experts warn that this situation may force further significant production cuts in the coming days.
Limited Volatility Forecast For Plastic Resin Prices
Plastic resins (such as PE, PP, and PVC) are primarily produced from petroleum-derived feedstocks like naphtha, ethane, and propylene, meaning fluctuations in oil prices directly impact production costs. However, Venezuela is not a significant supplier of naphtha on the global market; on the contrary, the country primarily imports naphtha (approximately 90,000–167,000 barrels per day in 2025, mainly from the United States and Russia) to serve as a diluent for heavy crude, facilitating transportation and export. Consequently, Venezuela accounts for nearly 0% of global naphtha supply (principal suppliers being Russia, Middle Eastern countries such as Saudi Arabia, Qatar, and the UAE, and the United States). The current disruption therefore exerts only indirect and highly limited effects on the plastic resin market, which is already experiencing strong oversupply from China and the Middle East.
In the short term, the blockade on Venezuelan oil may cause a slight increase in naphtha costs in certain Asian regions (as China seeks alternative sources for heavy oil, indirectly supporting petrochemical feedstock supply chains), potentially pushing plastic resin prices up temporarily by 5-10%. However, with stable low oil prices (below 60 USD per barrel), reduced energy costs will likely keep plastic resin prices flat or drive them downward, particularly amid slowing global demand due to economic recession.
In the long term, if Venezuelan oil production increases under U.S. oversight, a greater supply of cheaper crude could lower feedstock costs for the petrochemical industry, leading to a deeper decline in plastic resin prices (potentially 15-20% over 2-3 years). Nonetheless, geopolitical risks (such as prolonged conflict) could disrupt supply chains, compelling plastic resin manufacturers to diversify naphtha sources from the United States or Saudi Arabia.
Overall, tensions in Venezuela are not the sole dominant factor but do exert a certain influence amid global oversupply and the ongoing green transition (restrictions on single-use plastics, promotion of recycled plastics or environmentally friendly alternative materials, thereby reducing long-term demand for virgin resins).
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