A barrel of West Texas Intermediate (WTI) crude oil for February delivery on the New York NYMEX currently costs USD 58.15, down 0.29%. In turn, the price of Brent crude oil for March delivery on the London ICE is USD 61.64 per barrel, i.e. by 0.19%. less. During Monday's session, Brent prices increased by as much as 1.7%.
According to analysts, the increase in oil prices on Monday was a reaction to the increased geopolitical risk after the detention of Venezuelan President Nicolas Maduro by American special forces. The operation took place on Saturday in Caracas and other cities. Maduro and his wife Cilia Flores were transported to the USA.
American oil companies are expected to profit from the change of government in Venezuela
US President Donald Trump announced that after the change of power in Venezuela, American oil companies may invest billions of dollars to rebuild oil production in the country, which has fallen to one third of its former level in the last two decades due to sanctions and underinvestment. Trump also threatened the new leader of Venezuela, Delcy Rodriguez, with another wave of attacks if she does not take the expected actions.
This week, US Secretary of Energy Chris Wright plans meetings with representatives of American oil companies to discuss the possibilities of increasing oil production in Venezuela after the new government takes power – say sources familiar with the matter.
The return of American companies to Venezuela would be crucial to implementing the administration's plans, especially since the country has the world's largest oil reserves, processed mainly in American refineries. Experts emphasize, however, that rebuilding the mining potential will take years and require significant financial outlays.
– Yesterday's increase in oil prices resulted primarily from the geopolitical risk premium, not from fundamental changes in the market – comments Charu Chanana, chief investment strategist at Saxo Markets. He adds that oil futures are currently vulnerable to sharp corrections.
What's next for oil prices?
The oil market is currently struggling with a growing oversupply of the raw material, and Venezuela's share in global production remains small. Morgan Stanley analysts predict that the oil glut on global markets will increase in the first half of 2026, peaking by mid-year. In their market note, they emphasize that although geopolitical risks may affect prices, a lasting increase in prices only occurs in the event of actual production losses, which, however, rarely happens.
Morgan Stanley forecasts that the average price of Brent crude oil will be USD 57.50 per barrel in the first quarter, USD 55 in the second quarter and USD 57.50 in the third quarter of 2026. Previous forecasts assumed USD 60 per barrel. In the fourth quarter of 2026 and the first half of 2027, Brent prices are expected to remain at USD 60.
In 2025, Brent crude oil lost 18%. value, and the last time a barrel was below $55 was in 2021.
