NEW YORK, Jan 5, 2026, 02:45 ET — Market closed
- PDVSA has begun cutting crude output as exports stall under a U.S. tanker blockade, sources said.
- Oil edged lower despite the disruption, with traders citing ample global supply.
- Chevron and Exxon shares rose in the latest session as investors weighed the odds of sanctions relief and longer-term supply shifts.
Venezuela’s state oil company PDVSA has started shutting oilfields and ordering some joint ventures — including projects with Chevron and China National Petroleum Corporation — to curb output as it runs out of storage after a U.S. tanker blockade halted crude exports, sources said. After filling more than 45% of its 48-million-barrel onshore storage capacity, PDVSA began using tankers as floating storage — keeping crude at sea — with more than 17 million barrels waiting offshore, according to TankerTrackers.com. Shipping data showed cargoes from Chevron’s ventures have not left Venezuelan waters since Thursday amid shortages of diluents, the light oils used to thin Venezuela’s heavy crude for export.
The sudden export freeze matters because it hits a key source of heavy crude, but prices barely moved as traders focused on ample global supply. Brent was down 0.4% at $60.54 a barrel and U.S. West Texas Intermediate fell 0.5% to $57.04 in early Monday trading. Analysts at Goldman Sachs and JP Morgan pointed to U.S. sanctions policy as the main driver for whether Venezuela becomes a short-term supply shock or a longer-term source of extra barrels.
The bigger market debate is about the medium-term: whether a political transition and any easing of sanctions could lift production and weigh on oil prices later this decade. Venezuela holds about 303 billion barrels — roughly 17% of global oil reserves — and analysts said output has room to rise if investment returns. JP Morgan’s team led by Natasha Kaneva forecast production could reach 1.3–1.4 million barrels per day (bpd) within two years under a transition and as high as 2.5 million bpd over a decade, while Goldman Sachs estimated a $4-a-barrel downside to 2030 prices in a scenario where Venezuela climbs to 2 million bpd.
OPEC+ — the Organization of the Petroleum Exporting Countries and allies including Russia — kept its output policy unchanged on Sunday, extending a pause in planned hikes through March 2026. “Right now, oil markets are being driven less by supply–demand fundamentals and more by political uncertainty,” said Jorge Leon, head of geopolitical analysis at Rystad Energy. The producer group said its eight key members will meet again on Feb. 1. Reuters
In U.S. equities, Chevron last traded at $155.90, up 2.3% from the prior close, while Exxon Mobil was at $122.65, up 1.9%. Trump said U.S. oil companies were prepared to spend billions to restore Venezuela’s crude output, and Rice University’s Francisco Monaldi said firms will weigh political stability and how contracts are structured before committing fresh capital.
Deal-making is also back on traders’ radar. The Financial Times reported former Chevron executive Ali Moshiri is raising $2 billion for Venezuelan oil projects through his fund, Amos Global Energy Management, after Maduro’s capture and Trump’s pledge to take control of the oil-producing nation; Reuters said the fund did not immediately respond to a request for comment.
If U.S. restrictions are eased, trade flows could shift faster than production can. Reuters analysis said Venezuelan crude would likely re-route back toward the United States — and away from China — boosting U.S. Gulf Coast refiners that are configured to run heavy-grade crude. China accounted for more than half of Venezuela’s 768,000 bpd crude exports last year, according to Kpler, much of it bought by independent “teapot” refiners that have been willing to take discounted barrels. Reuters
On the ground, two sources familiar with PDVSA’s operations said Venezuela’s oil production and refining were running normally and facilities were not damaged by the U.S. strike that seized Maduro. The tanker blockade and earlier U.S. seizures of cargoes cut exports last month to about half the 950,000 bpd shipped in November, forcing PDVSA to slow port deliveries and store crude on vessels. PDVSA has also been working through a December cyberattack that disrupted administrative systems, the sources said.
The main downside risk is that the export stop turns into a longer outage, with equipment constraints, power issues and the cost of restarting shut-in wells limiting any quick rebound. Analysts at Global Risk Management, MST Marquee and Rystad Energy have cautioned that even under a more stable government, rebuilding heavy-oil output is slow and capital-intensive, and forced political transitions have not reliably stabilized supply in past cases such as Libya and Iraq.
Technically, Brent hovering around $60 leaves traders watching whether that round number holds as a near-term support level. Longer-dated pricing — the oil futures curve, which shows prices for later deliveries — is likely to react first if Washington signals a clear path to sanctions relief and a gradual Venezuelan supply rebuild.
The next test for prices is policy: any guidance from Washington on the scope and duration of its embargo, alongside tanker movements out of Venezuela’s main ports. Traders will also parse U.S. stockpile data, with the Energy Information Administration’s next Weekly Petroleum Status Report due on Jan. 7.
