Oil Prices Swing Amid U.S. Capture of Venezuela’s Maduro and Growing Supply Surplus

Economic

Commodity

Summary:

Oil markets fluctuated following the U.S. capture of Venezuelan President Nicolás Maduro. Despite the geopolitical shock, prices remained capped as traders focused on global oversupply and unchanged OPEC+ output plans....

Oil Volatility Rises as U.S. Detains Maduro, but Surplus Keeps Prices in Check

The global oil market experienced brief turbulence after the unexpected U.S. capture of Venezuelan President Nicolás Maduro over the weekend, sparking speculation about the future of Venezuela’s crippled oil sector. Brent crude initially fell as much as 1.2% before recovering to hover around $61 per barrel, while West Texas Intermediate (WTI) traded above $57.

However, despite the political upheaval, the reaction in oil prices has been modest underscoring a broader dynamic at play: Venezuela’s diminished role in global supply and a swelling crude surplus that continues to weigh on market sentiment.

Limited Market Impact from Venezuela’s Oil Sector

Venezuela, once a top-tier oil producer, now contributes less than 1% to global supply due to two decades of mismanagement, underinvestment, and sanctions. Most of its output is exported to China and much of its infrastructure is already operating below capacity. According to sources familiar with the matter, critical facilities like the José oil terminal, Amuay refinery, and production in the Orinoco Belt remain intact and unaffected by the U.S. strike.

That said, U.S. enforcement actions including tanker seizures have pressured Venezuela to shut some oil wells preemptively. But any disruption, experts note, can easily be offset by OPEC+ capacity, U.S. shale production, or other global suppliers.

Surplus, Not Sanctions, Driving Prices

Neil Shearing of Capital Economics noted that the market is currently more focused on fundamentals than geopolitics. “Any short-term disruption to Venezuelan output can easily be offset by increased production elsewhere,” he wrote, projecting that a persistent supply glut could push prices toward $50 per barrel in the coming year.

Haris Khurshid, CIO of Karobaar Capital, echoed this sentiment: “Barrels don’t come back overnight. It still feels like the surplus is doing most of the talking and outweighing geopolitics, which keeps a lid on prices.”

The latest OPEC+ meeting reinforced this outlook. The group, led by Saudi Arabia and Russia, opted to stick with its plan to pause output increases for Q1 2026, showing no urgency to intervene. Delegates reportedly didn’t even discuss Venezuela during their 10-minute video conference, highlighting the limited near-term significance of the crisis.

Trump’s Oil Ambitions in Venezuela Face Long Timeline

President Donald Trump responded to the crisis by affirming that sanctions would remain in place but expressed readiness for U.S. companies to help “rebuild” Venezuela’s oil sector. He emphasized that American firms are eager to invest but acknowledged the recovery would be long and complex.

While the White House promises future support, meaningful reactivation of Venezuela’s energy sector would require legal restructuring, infrastructure overhauls, and political normalization all unlikely in the short term. Secretary of State Marco Rubio stated that oil leverage will be used to “force further change,” while Venezuela’s Defense Minister demanded Maduro’s release, calling him the country’s legitimate leader.

Prices Stuck Between Geopolitical Uncertainty and Structural Surplus

The Maduro saga has introduced another layer of geopolitical uncertainty to an already volatile oil market. However, with Venezuela’s production capacity marginalized and the global market awash in surplus barrels, the immediate price reaction has been muted.

Unless physical infrastructure is disrupted or sanctions unexpectedly loosen, investors are likely to keep their focus on the larger supply-demand imbalance. For now, the market appears to be balancing speculative headlines with hard fundamentals favoring a downward bias in crude prices heading into 2026.

Source: Bloomberg

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

Add to Favorites

FastBull Featured

Daily News

[Quick Facts]

1. U.S. airstrikes on Venezuela; President Maduro arrested.

2. The Trump Administration's military action against Venezuela triggers Democratic backlash, and several lawmakers propose impeachment proceedings.

3. Political turmoil paralyzes Venezuela's oil exports, sources say.

4. Iran's supreme leader responds to U.S. military action against Venezuela: We will not surrender to the enemy.

5. Over 100 U.S. cities hold protests against the attack on Venezuela.

6. Venezuela's supreme court appoints acting president. No 30-day election process initiated.

7. Trump delays significant tariff increases on furniture.

8. U.S. December S&P Global Manufacturing PMI dips slightly to 51.8.

[News Details]

U.S. airstrikes on Venezuela; President Maduro arrested

U.S. President Donald Trump confirmed that the U.S. military has launched large-scale strikes on Venezuela, stating that Venezuelan President Nicolás Maduro and his wife have been captured and taken out of the country. Prior to this, multiple explosions occurred in Caracas, prompting the Venezuelan government to declare a state of national emergency. Trump said he would hold a press conference at Mar-a-Lago at 11 a.m. local time on January 3rd.

Reuters cited witnesses reporting loud aircraft roars and explosions in Venezuela's capital, Caracas, on Saturday, with thick smoke visible. Power outages were also reported near a major military base in southern Caracas. U.S. media reported that President Trump ordered attacks on Venezuelan targets, including military facilities.

The Trump Administration's military action against Venezuela triggers Democratic backlash, and several lawmakers propose impeachment proceedings

The Trump administration's unilateral military strike on Venezuela and capture of President Maduro have sparked intense political reactions domestically, angering many Democrats. Some lawmakers have publicly called for initiating procedures to impeach Trump.

Illinois Democratic Representative Delia Ramirez issued a statement explicitly demanding Trump's impeachment and urging Congress to pass legislation restricting presidential war powers. California Democratic Representative Jared Huffman criticized Trump's plan as "absolutely insane" and "catastrophic," telling media that the current situation falls under the scope of the 25th Amendment to the U.S. Constitution, which outlines procedures for removing a president unable to perform duties.

Although Democrats did not formally advance impeachment proceedings against Trump in 2025, U.S. media reported that discussions within the party about impeachment are intensifying as more lawmakers call for stronger measures. The Trump administration's military action against Venezuela appears to have further fueled demands to hold the president accountable.

Political turmoil paralyzes Venezuela's oil exports, sources say

Sources revealed that Venezuela's oil exports have effectively ground to a halt due to ongoing political turmoil. Monitoring data shows multiple crude and fuel transport vessels scheduled to sail to the U.S. and Asia failed to depart on time, while some waiting-to-load ships left port empty. Data from the tanker tracking website TankerTrackers on Saturday confirmed no oil tankers loaded cargo at José Port, Venezuela's main oil export hub, that day.

According to insiders and internal documents from Petróleos de Venezuela, S.A. (PDVSA), the export suspension is widespread, even affecting tankers chartered by its key partner Chevron. Industry analysts noted that a full export halt may force the country to accelerate production cuts. In recent weeks, onshore storage tanks and floating storage vessels have rapidly neared capacity, and prolonged export disruptions will place immense pressure on the oil production system.

Iran's supreme leader responds to U.S. military action against Venezuela: We will not surrender to the enemy

Iran's Supreme Leader Ayatollah Ali Khamenei delivered a speech on the 3rd regarding U.S. military action against Venezuela, vowing never to yield to enemies. Khamenei stated, "What matters is that when a person realizes that the enemy is arrogantly trying to impose something on the country, on the officials, on the government and on the nation, he must stand firm against the enemy and resist him. We will not surrender to the enemy."

Over 100 U.S. cities hold protests against the attack on Venezuela

Over 100 U.S. cities held demonstrations on the 3rd to protest the U.S. attack on Venezuela and oppose using force to subvert other countries' governments. Organized by anti-war groups Code Pink and ANSWER Coalition, the protests took place in 105 cities, including Washington D.C., Los Angeles, Boston, Atlanta, Chicago, Denver, Dallas, and Miami. In a statement, organizers said U.S.-launched wars will bring death and destruction to the Venezuelan people. The U.S. war machine drains vast taxpayer funds, while working-class families struggle to make ends meet. The American people do not want another war—"No to war against Venezuela!"

Venezuela's supreme court appoints acting president. No 30-day election process initiated

Venezuela's Supreme Court ordered on the 3rd the appointment of Vice President and Oil Minister Delcy Rodríguez as acting president. Under the constitution, if the president is declared in "absolute absence," power transfers to the vice president, with elections required within 30 days. Notably, the Supreme Court did not declare President Maduro in "absolute absence." Media analysis suggests this legal ruling means the 30-day election provision will not be triggered procedurally for now.

Trump delays significant tariff increases on furniture

On New Year's Eve, Trump signed a proclamation delaying tariffs on upholstered furniture, cabinets, and bathroom vanities for one year, citing ongoing trade negotiations, providing relief for U.S. home consumers and businesses. An executive order signed by Trump on Wednesday retained the 25% tariffs imposed on these goods last September but postponed the 30% tariff on upholstered furniture and 50% tariff on cabinets and bathroom vanities until January 1st, 2027.

U.S. December S&P Global Manufacturing PMI dips slightly to 51.8

S&P Global PMI survey showed continued improvement in U.S. manufacturing operating conditions in December, albeit at a slower pace. The seasonally adjusted U.S. Manufacturing PMI recorded 51.8 in December, matching the preliminary reading and down from 52.2 in November, the weakest expansion in five months.

The latest survey found slower production growth, while new orders contracted again for the first time in a year. International sales continued to decline, partly due to tariffs, which also kept driving up operating costs at a rapid pace. However, although input and output price growth remained historically high, their rates were the slowest in 11 months. Companies reported employment growth continuing through the end of 2025, with new jobs reaching the most significant level since August. Despite a slight dip since November, confidence in the future remained positive.

[Today's Focus]

UTC+8 15:30 Switzerland November Real Retail Sales YoY

UTC+8 17:30 Eurozone January Sentix Investor Confidence Index

UTC+8 23:00 U.S. December ISM Manufacturing PMI

UTC+8 23:00 UN Security Council Emergency Meeting on U.S. Military Action Against Venezuela

Risk Warnings and Disclaimers

Add to Favorites

Forex kids 101

Commodity

Daily – 4H – 1H Confluence Prepared for Short- to Medium-Term Execution.

1. Market Overview and Strategic Context

Gold (XAUUSD) remains in a primary bullish macro structure, supported by a sequence of higher highs and higher lows on the Daily timeframe. However, following the recent rejection from the All-Time High (ATH) at 4,549.86, price has transitioned into a corrective and consolidative phase.

This trading plan is designed to:

Trade with the dominant trend when conditions align
Exploit high-probability pullbacks
Allow for short-term countertrend opportunities at key resistance
Maintain strict risk control, particularly on the 1H timeframe

The plan focuses on structure, key levels, and confirmation, not prediction.

2. Daily Timeframe Analysis (Directional Bias)

2.1 Daily Market Structure

On the Daily timeframe:

The broader trend remains bullish
Price is trading above the ascending trendline
A former resistance zone has been flipped into RSS (Resistance Turned Support)

2.2 Key Daily Levels

All-Time High (ATH): 4,549.86
Daily Resistance Zone: 4,390 – 4,420
Daily RSS / Support Zone: 4,240 – 4,270
Major Daily Low (Invalidation Area): 3,734.32

2.3 Daily Bias Conclusion

XAUUSD (Gold) Multi-Timeframe Trading Plan_1

As long as price holds above 4,240, the Daily bias remains bullish, favouring buy setups on pullbacks.A Daily close below 4,200 would weaken bullish continuation and increase downside probability.

3. 4-Hour Timeframe Analysis (Structure and Zones)

3.1 4H Market Behaviour

The 4H timeframe shows:

A completed impulsive rally into ATH
A sharp corrective leg lower
Range formation between resistance and RSS

This signals market balance, where liquidity is being built before the next expansion.

3.2 Key 4H Levels

4H Resistance: 4,380 – 4,410
4H Range Midpoint: ~4,320
4H RSS / Demand Zone: 4,250 – 4,270
4H Structural Support: 4,163.46

3.3 4H Bias

Above 4,250 → bullish continuation favoured
Below 4,200 → deeper correction toward 4,160 becomes likely

The 4H chart defines where trades are allowed; execution is refined on the 1H.

4. 1-Hour Timeframe Execution Plan

(Stop-Loss Strictly 40–50 Pips)

XAUUSD (Gold) Multi-Timeframe Trading Plan_2

The 1H timeframe is used only for entries, stop-loss control, and trade management.

SCENARIO 1: BUY – Pullback into Support (Primary Setup)

Market Logic

This setup aligns:

Daily bullish trend
4H RSS support
1H corrective structure

Entry Zone

Buy Zone: 4,260 – 4,280

Entry Trigger

Price sweeps below minor 1H lows
Bullish 1H candle closes back above 4,270

Stop-Loss

SL: 4,220 – 4,230(40–50 pips below entry and below support)

Take-Profit Targets

TP1: 4,330
TP2: 4,390
TP3 (Runner): 4,550 (ATH break)

Expected Risk–Reward:

TP1: ~1:2
TP2: ~1:3
TP3: 1:5+

SCENARIO 2: BUY – Break and Retest of Resistance

Market Logic

This setup confirms strength, not anticipation.

Conditions

1H close above 4,410
Pullback holding above former resistance

Entry

Buy: 4,400 – 4,410 (on retest)

Stop-Loss

SL: 4,360 – 4,370(40–50 pips)

Take-Profit Targets

TP1: 4,470
TP2: 4,520
TP3: 4,600+

SCENARIO 3: SELL – Rejection from Resistance (Countertrend)

Market Logic

This is a short-term corrective trade, not a trend reversal.

Entry Zone

Sell Zone: 4,380 – 4,410

Entry Trigger

Liquidity sweep above 4,400
Strong bearish 1H close back below resistance

Stop-Loss

SL: 4,430 – 4,460(40–50 pips above rejection)

Take-Profit Targets

TP1: 4,320
TP2: 4,270
TP3: 4,200

Risk–Reward:

Minimum 1:3 if targeting TP2

5. Trade Invalidation Rules

Immediately exit if:

A 1H candle closes beyond the invalidation level
Stop-loss is hit
4H structure breaks against the trade

No averaging down. No revenge trades.

6. Risk Management Framework

Risk per trade: Maximum 1%
Stop-loss: 40–50 pips only
One trade per setup
Partial profits mandatory at TP1

Consistency > frequency.

7. Final Outlook and Expectations

Gold remains structurally bullish, but price is currently in a decision zone.The market is offering:

High-probability buy-the-dip opportunities
Tactical short-term sells at resistance
A clear roadmap toward a potential ATH breakout

Execution discipline and patience will determine performance—not prediction.

Risk Warnings and Disclaimers

Add to Favorites

Justin

Political

Economic

Nicolás Maduro will have already spent more than 24 hours in one of the toughest US jails when he appears in court Monday to face charges that could keep him behind bars for the rest of his life.

The ousted Venezuelan president and his wife, Cilia Flores, joined the approximately 1,330 inmates at the notorious Metropolitan Detention Center in Brooklyn on Saturday following a surprise night time raid and odyssey that included a US warship, a plane and a helicopter.

For years, the hulking concrete jail has drawn sharp criticism from judges, lawyers and watchdogs. In 2024, one judge bluntly dubbed the conditions at New York City's only federal jail as "dreadful in many respects." Another described them as "dangerous, barbaric."

By all accounts, it's a world away from the rarefied public existence Maduro and Flores had been living.

In Caracas, Maduro lived inside a sprawling military complex called Fort Tiuna.

Venezuela never made public exactly where Maduro resided within the military base and he's shared little of his private living space on social media. But on one occasion followers caught a brief glimpse of a modest kitchen, where his wife was shown making coffee using a worn cloth.

Most of Maduro's public life unfolded at Miraflores Palace, the presidential seat in downtown Caracas that occupies an entire city block. He hosted foreign leaders and athletes at the 19th century French neo-baroque mansion, which features a large central courtyard and ceremonial halls decorated with chandeliers, carpets and portraits of national heroes.

He greeted supporters from the palace balcony during government-organized rallies. Maduro also often had visitors over for coffee, and displayed symbolic items such as the sword of independence hero Simón Bolívar.

On Monday, Maduro will be taken across the water from his Brooklyn lock-up to federal court in Lower Manhattan where he'll face US charges that he played a key role in a broad conspiracy over 25 years to traffic cocaine into the US.

The indictment released on Saturday accuses Maduro and others of partnering with groups including the Sinaloa Cartel and Tren de Aragua, which have been designated by the US as foreign terrorist organizations.

Authorities have devised a plan to whisk the ousted leader across the river by helicopter on Monday, according to a person familiar with the matter who asked not to be identified discussing logistics. They are planning to fly Maduro over New York Harbor on a route that will take him past the Statue of Liberty toward Wall Street. From a helipad there, a short motorcade would carry him to the federal courthouse in Lower Manhattan, said the person.

The hearing is set for 12 p.m. in New York and will be overseen by US District Judge Alvin Hellerstein, 92, a Bronx native appointed by Bill Clinton who has presided over cases tied to the Sept. 11 attacks and major financial fraud trials.

Bail is unlikely. The judge is expected to set an initial schedule for evidence exchanges and pretrial motions, with a trial not expected until at least 2027.

It is not clear if Maduro or his wife has hired a lawyer for the hearing. Sometimes defendants are represented by free lawyers from the Federal Defenders of New York for purposes of an initial court appearance.

At his new temporary cell in Brooklyn, Maduro is likely to be held under the jail's most restrictive conditions.

At MDC, high-risk detainees are typically placed in special housing, where confinement can stretch to 23 hours a day. Movement outside the cell is tightly controlled. Confinement in the MDC "will test the strongest mind," said Justin Paperny, a prison consultant who has advised clients held at the facility.

Paperny cited staffing difficulties, training deficiencies and mental health issues among the prisoners as challenges to maintaining the jail.

Other complaints include rotten food, thin mattresses and filthy, broken toilets. Inmates can become disoriented and lose track of the time, with lights constantly on and no view of the outside, Paperny said.

A representative for the Bureau of Prisons didn't respond to a request for comment. The Bureau of Prisons has said conditions at MDC in Brooklyn have improved, citing staffing increases and a reduced inmate population.

Paperny said Maduro's communications will be closely monitored and his movements carefully managed, with security and physical safety taking precedence over comfort.

The MDC is the only federal jail in New York as the Bureau of Prisons closed Manhattan's Metropolitan Correctional Center in 2021 to address deteriorating conditions. Jeffrey Epstein died by suicide in the MCC in 2019.

Since then, MDC has been a temporary home for high-profile inmates, including Sean "Diddy" Combs, Ghislaine Maxwell and Luigi Mangione.

Sam Bankman-Fried was held in the jail before his 2023 conviction for fraud at his FTX cryptocurrency exchange. While there he said he befriended former Honduras President Juan Orlando Hernández, who was found guilty in 2024 of conspiring to import cocaine into the US.

Hernandez was later transferred to serve a 45-year sentence in a prison in West Virginia. He was recently pardoned by President Donald Trump.

Source: Bloomberg Europe

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Winkelmann

Bond

Economic

Japan's long-maturity government bonds kicked off 2026 on a downbeat note, as fiscal and inflation worries continued to weigh on the market.

The benchmark 10-year Japanese government bond yield climbed as much as five basis points on Monday to 2.12%, its highest level since 1999. Yields on 20-year and 30-year bonds also rose.

The moves followed a selloff in long-dated US Treasuries, steepening the yield curve as traders price in higher defense spending under the Trump administration stoked by rising geopolitical risks. In Japan, Prime Minister Sanae Takaichi's government is set to lift defense spending to a record next year as part of a ¥122.3 trillion ($780 billion) budget approved by the cabinet last month.

Meanwhile, the yen's weakness has intensified concerns that the Bank of Japan may be slow in its efforts to rein in inflation. The currency gained less than 1% against the dollar in 2025, following four consecutive years of declines.

Long-term JGB yields may continue to face upward pressure "as long as market participants continue to sense 'reflationary' policy intentions on the part of the Takaichi administration," Mizuho Securities Co. economist Yusuke Matsuo wrote in a note on Monday. He added that some of that pressure could be tempered by the Ministry of Finance's plan to cut issuance of super-long bonds in the fiscal year starting in April.

Caution is also building ahead of a 10-year JGB auction on Tuesday. While elevated yields and demand for newly issued bonds may attract some dip-buying, "it is difficult to turn bullish amid lingering concerns that the BOJ is behind the curve," said Keisuke Tsuruta, senior bond strategist at Mitsubishi UFJ Morgan Stanley Securities Co.

Source: Bloomberg Europe

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Samantha Luan

Political

Economic

A damaged building following U.S. strikes on Venezuela, during which President Nicolas Maduro and his wife, Cilia Flores, were captured, in Catia La Mar, Venezuela, January 4, 2026. REUTERS/Gaby Oraa

The Cuban government said on Sunday that 32 of its citizens were killed during the U.S. raid on Venezuela to extract President Nicolas Maduro for prosecution in the United States.

Havana said there would be two days of mourning on January 5 and 6 in honor of those killed and said funeral arrangements would be announced.

The Cuban government statement gave few details, but said all the dead were members of the Cuban armed forces and intelligence agencies.

"True to their responsibilities concerning security and defense, our compatriots fulfilled their duty with dignity and heroism and fell, after fierce resistance, in direct combat against the attackers or as a result of bombings on the facilities," the statement said.

Cuba has provided some security for Maduro since he came to power. It was not clear how many Cubans were guarding the Venezuelan president when they died and how many may have perished elsewhere.

Maduro, 63, and his wife Cilia Flores were seized by U.S. forces in the Venezuela capital Caracas on Saturday and flown to the United States. Maduro is being held in a New York detention center awaiting a Monday court appearance on drug charges.

Maduro was indicted in 2020 on U.S. charges including narco-terrorism conspiracy. He has always denied any criminal involvement.

Source: Reuters

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Justin

Political

Economic

Commodity

After the US's stunning capture of Venezuelan President Nicolás Maduro over the weekend the focus is turning to how quickly the country with the world's largest proven crude reserves can raise output.

In the short term, it's unclear how much oil Venezuela will be able to export and whether flows to China will continue.

And while President Donald Trump has said US companies will spend billions of dollars to rebuild the country's energy infrastructure over the longer term, there are big doubts about whether the oil majors will want to invest in what is a very uncertain environment.

Here's what analysts are saying about Venezuela:

"There will undoubtedly be a segment of the market that will embrace a 'Mission Accomplished' narrative and will pencil-in an easy glide path back to 3 million barrels a day of production," analysts including Helima Croft said in a note, adding that full sanctions relief could unlock several hundred thousand barrels a day in the next 12 months assuming an orderly transition of power.

However, "the situation at the time of writing remains very fluid, but we continue to caution market observers that it will be a long road back for the country," they said.

"In theory, Venezuela could again become a major producer: it still claims to hold the world's largest proven oil reserves," Chief Economist Neil Shearing said in a note. "But theory and reality diverge sharply. If nothing else, geopolitical alignments in Venezuela remain unclear in the wake of Maduro's capture," he said.

Even if output were to rise to levels seen a decade ago, around 3 million barrels a day, that would only add about 2% to global oil supply, Shearing said.

Brent oil prices could average $2 a barrel higher than Goldman Sachs Group Inc.'s base-case forecast of $56 a barrel for Brent this year if Venezuelan crude production falls by 400,000 barrels a day by year-end, analysts including Daan Struyven said in a note. Or, they could be $2 lower if output rises by that amount.

"Along with recent Russia and US production beats, potentially higher long-run Venezuela production further increases the downside risks to our oil price forecast for 2027 and beyond," Goldman said. "We estimate $4 a barrel of downside to 2030 oil prices in a scenario where Venezuela crude production rises to 2 million barrels a day in 2030," compared with 900,000 barrels a day in the bank's earlier base case.

A limited market reaction is likely as there's ample oil supply globally, said Chief Analyst Arne Lohmann Rasmussen. "Venezuela is known for having the world's largest proven oil reserves, exceeding 300 billion barrels," he said in a note. "However, reserves are one thing, production another. Venezuela's oil production today is around 1 million barrels per day."

Given Venezuelan crude is heavy and sulfur-rich, only refineries in the US and some in China can process the oil, Rasmussen said, adding that a potential loss of this type of oil is not particularly problematic for the global market.