While the U.S. attack on Venezuela could lead to lower crude oil prices over the long term, the short-term outlook is less clear given that the country would struggle to quickly increase output and uncertainty over future U.S. actions.
Goldman Sachs analyst Daan Struyven on Sunday said the potential for higher Venezuelan production in the longer terms and recent signs higher-than-expected U.S. and Russian oil output has increased downside risks to his crude oil price forecasts for 2027 and beyond.
Should Venezuela's crude production rise to 2 million b/d from the Goldman's previous forecast of 900,000 b/d, Struyven said his 2030 Brent crude price estimate $80/bbl could fall by $4.
He added that a gradual rise in Venezuela's "diesel-rich" heavy crude oil production could serve to reduce headwinds to a structurally bullish outlook for diesel margins.
The more sophisticated U.S. coastal refineries that use heavy crudes typically have a higher diesel yield than those using lighter crude feedstocks.
Given uncertainties over whether and when Venezuela will able to raise oil output, Struyven made no changes to his 2026 forecast that has Brent averaging $56/bbl and West Texas Intermediate crude at an average price of $52/bbl.
While Venezuela has about 20% of the world's crude reserves, Struyven said any recovery in production volumes would likely be gradual and partial due to the country's degraded infrastructure and the need for substantial upstream investments.
Any increase in Venezuela's oil output also would require financial investments in oil-processing upgraders and improvements in operational efficiencies, power availability and oil transportation infrastructure, he said.
Struyven said while Venezuela's production could rise over short-term may under a U.S.-supported government and the easing of sanctions, political uncertainty could continue for some time.
Doug Leggate, an analyst at Wolfe esearch, said he believes the implications of potentially higher oil output from Venezuela are more likely to be seen over the longer term, even though President Nicolás Maduro's capture by U.S. military forces should help to ease geopolitical risks to the market.
A key question for the market, Leggate added, is whether Venezuela, which has estimated oil reserves of 300 billion barrels, can re-emerge as a material source of long-term oil supply.
He added that with proper maintenance, the country's production could by about 1 million b/d within two to three years, while growth above that rate would require additional material investment, competitive operating terms and contract certainty.
Independent oil analyst Philip Verleger said a possible recovery in Venezuela's oil production should U.S. companies enter the country and fix its infrastructure would "ensure that the current global oil surplus will result in much lower prices."
Verleger even speculated that global oil prices could return to about $10/bbl should OPEC and allied producers, led by the United Arab Emirates, abandon the group's policy of production discipline following the U.S. action in Venezuela.
This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.
Reporting by Frank Tang, ftang@opisnet.com; Editing by Jeffrey Barber, jbarber@opisnet.com
(END) Dow Jones Newswires
January 05, 2026 13:51 ET (18:51 GMT)
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