In a development set to reshape global oil dynamics, U.S. President Donald Trump announced that Venezuela would hand over between 30 and 50 million barrels of crude oil to the United States. The announcement on Wednesday triggered a decline in crude prices, even as global equity markets displayed mixed movements following a record-breaking start to the year.
“The Interim Authorities in Venezuela will be turning over between 30 and 50 million barrels of high-quality, sanctioned oil to the United States of America,” Trump declared on his Truth Social platform. “This oil will be sold at its market price, and that revenue will be controlled by me, as President, to ensure it benefits both the people of Venezuela and the United States.”
Oil markets have experienced extreme volatility since Trump’s Saturday directive to topple Venezuelan President Nicolas Maduro and assert Washington’s oversight of the country’s key resources. Both West Texas Intermediate and Brent crude fell over one percent on Wednesday, following declines of up to two percent on Tuesday. Analysts attributed the slide to reduced fears of supply disruption, as the Venezuelan oil handover eases storage and output concerns.
Despite Venezuela holding roughly a fifth of the world’s oil reserves, experts caution that a rapid increase in production faces significant obstacles, including ageing infrastructure, political instability, and fluctuating global oil prices.
Equity markets mirrored the complex global backdrop. While indices in Seoul, Shanghai, Sydney, Wellington, Manila, and Jakarta gained modestly, key Asian markets fell, with Hong Kong down 1.3 percent, Tokyo shedding 1.1 percent, and Singapore and Mumbai also retreating. Analysts linked the Tokyo downturn to China’s stricter export controls on items with potential military applications destined for Japan.
“Despite rising geopolitical tensions, investor sentiment remains broadly positive,” said Michael Brown of Pepperstone. “The market continues to focus on resilient economic growth and robust earnings, while expectations of looser monetary and fiscal policies support a bullish outlook. Any short-term dips are likely to be viewed as buying opportunities.”
Key Market Figures (as of 0715 GMT Wednesday)
West Texas Intermediate: $56.24 per barrel, down 1.6%
Brent North Sea Crude: $60.00 per barrel, down 1.2%
New York Dow: 49,462.08, up 1.0%
London FTSE 100: 10,122.73, up 1.2%
Tokyo Nikkei 225: 51,961.98, down 1.1%
Hong Kong Hang Seng: 26,368.27, down 1.3%
Shanghai Composite: 4,085.77, up 0.1%
