Khaberni - Markets did not react in the traditional way to the crisis in Venezuela, as after the United States arrested President Nicolas Maduro, Brent crude prices registered a slight increase not exceeding one dollar per barrel.
This reflects the abundance of global supplies that make any disruption in Venezuela unable to immediately threaten production levels.
This calm market reaction clearly indicates that there is already a surplus, whether Venezuelan production continues or temporarily stops, while the International Energy Agency had warned months ago that supply would exceed demand by about 4 million barrels per day this current year.
The Venezuelan tension and the American intervention
In early January 2026, events escalated in Venezuela following the American military operation that resulted in the arrest of Maduro and his wife Celia Flores, and their transfer out of the country.
Many considered this move as a direct intervention in Venezuelan oil affairs, as the South American country holds the world's largest proven oil reserves, estimated at around 303 billion barrels, equivalent to 17.3 trillion dollars in current market value.
The American President, Donald Trump, explained that the United States will work on modernizing and exploiting these reserves, with significant investments in rehabilitating the deteriorating infrastructure and raising production levels, which puts American companies at the heart of future production and export operations.
Despite these interventions, Madhat Youssef, former deputy head of the Egyptian Petroleum Authority, clarified that this move would not affect the economies of the Gulf countries, because the expected production from the Venezuelan market does not exceed 800 to 900 thousand barrels per day, a relatively limited figure compared to the current global production capacity, which reduces any direct impact on Gulf oil prices.
At the same time, the OPEC+ alliance focuses on its production plans for the year 2026, with the aim of regaining market share.
However, the Oxford Institute for Research warned that the volatility of the global oil market represents a significant challenge that must be addressed by the main players.
Madhat Youssef confirmed that the global oil supply exceeds the current demand, which mitigates the impact of geopolitical events on prices, as estimates indicate a surplus of about 1.5 million barrels per day, which could reach 3.5 million barrels per day in some scenarios.
Youssef added that the United States is seeking to enhance its dominance over the global energy market through its massive production of conventional and shale oil, making it a direct competitor to OPEC in setting prices and production policies.
Hossam Arafat, professor of petroleum and energy engineering, pointed out that the markets are currently insulated thanks to the surplus supply, and that any individual crisis in a country like Venezuela will not lead to significant price jumps, as prices are now moving in the range of 60-61 dollars per barrel, clarifying that any significant increase in prices will only occur if the OPEC+ alliance decides to reduce production collectively and significantly.
The International Energy Agency reported on July 2, 2025, that electric vehicles will contribute to reducing global oil demand by about 5.4 million barrels per day by the end of the current decade, and that substituting oil with natural gas and renewable energy sources in power generation, especially in the Middle East and specifically Saudi Arabia, will reduce the demand growth for oil in the coming years.
Arafat added that any significant increase in oil prices will only occur under two specific conditions: the first if Saudi Arabia significantly reduces its production and exports, and the second if the OPEC+ alliance makes a collective decision to reduce the production ceiling.
On the other hand, any potential increase in Venezuelan oil production after the American permission will increase the global supply, which will lead to a decrease in prices, benefiting importing countries while potentially harming exporting countries.
Oil specifications of Venezuela
"Merey 16" crude oil is considered the standard for Venezuela, among the types of heavy and sour oil, and forms the majority of exports of the Venezuelan state oil company, primarily extracted from the Orinoco Oil Belt, where it is prepared by mixing it with diluting materials to facilitate its transportation, handling, and refining, according to "Shell" specialized in energy and mining affairs.
Arafat clarified that the specifications of Venezuelan oil differ from most light and medium oil grades dominating Gulf exports, which limits its ability to compete in Asian and European markets except in some specialized refineries, especially American ones. This situation allows American refineries an opportunity to acquire more Venezuelan crude to compensate for heavy Canadian oil, while China, which relied on Venezuelan supplies, can compensate from more reliable Middle Eastern crude sources.
OPEC+ and production policies
On January 4, 2026, the OPEC+ alliance agreed to keep the suspension of production increases during the first quarter of the year, a step aimed at adjusting the market globally despite the Venezuelan crisis; this confirms the alliance's ability to control the production ceiling, maintaining balance between supply and demand, and limiting any sharp fluctuations in prices, which makes the Venezuelan crisis economically limited in impact despite its political and media significance.
OPEC's report predicted that the demand for primary energy will rise by 23% to reach 378 million barrels of oil equivalent per day by 2050, with demand for oil rising to about 122.9 million barrels per day, driven by economic growth in developing countries like India, the Middle East, Africa, and Asia.
It is expected that demand in the Organization for Economic Cooperation and Development (OECD) countries will decrease. Oil and gas will continue to meet more than half of the global energy mix, while renewable energy sources and natural gas register noticeable growth, with a decline in coal use and a rise in electricity production by 80% to reach 57,500 terawatt hours.
Limited repercussions on oil markets
The global production surplus was one of the main reasons for absorbing the shocks resulting from geopolitical events in Venezuela, as the International Energy Agency expected supply to exceed demand by about 4 million barrels per day in the current year.
J.P. Morgan predicts that Venezuelan oil production will take years to reach higher levels, with production expected to reach 1.3-1.4 million barrels per day within two years, and to 2.5 million barrels per day within ten years, without significantly affecting the market except for a moderate price drop estimated at about 4 dollars per barrel by 2030.
Regional impact
Karim al-Omda, professor of international economy, stated that the decline in oil prices provides the Egyptian state with a broader financial maneuvering space, as each decrease in the price of Brent crude reduces fuel subsidy costs, which decreases the pressure on the state budget, and gives the government room to lower fuel prices.
Al-Omda added that countries like the UAE enjoy economic stability thanks to the diversity of revenue sources, as non-oil activities account for about 75% of the gross domestic product, and the breakeven price is about $48 per barrel, giving it greater ability to face global price fluctuations.
