Oil prices are falling: what are the reasons?
5 January 10:38
On Monday, December 5, oil prices showed a decline as ample global stocks of raw materials calmed the market after the high-profile detention of Venezuelan President Nicolas Maduro by US intelligence agencies.
This is reported by "Komersant Ukrainian" with reference to the Reuters publication.
Futures for Brent crude oil fell to $60.54 per barrel, while US WTI lost $57.04.
Market reaction
After the detention of Nicolas Maduro in New York, President Donald Trump reaffirmed Washington’s intention to establish control over the oil-producing country and emphasized the continuation of the full energy embargo.
Despite statements by Venezuelan officials about the “kidnapping” of the leader, the market reacted calmly. Analysts note that the current oversupply of raw materials on the global market avoids an immediate price spike even if Venezuelan exports are halted.
Analysts’ forecasts
Goldman Sachs experts assess the risks to oil prices as moderate and leave their forecasts for 2026 unchanged. Much depends on the further US sanctions policy and how quickly the new administration in Caracas will be able to change the regime.
JP Morgan believes that regime change in Venezuela will immediately become one of the biggest risks to global oil supply prospects for 2026-2027 and beyond, as it could pave the way for significant investment.
Production and OPEC’s position
So far, Venezuela’s refining infrastructure has not been affected by the US military operation. RBC Capital experts suggest that if sanctions are completely lifted, the country will be able to supply several hundred thousand barrels of oil to the market every day.
An additional factor in stabilizing the market was Sunday’s decision by OPEC countries to keep current production volumes unchanged, which ensured predictability of supply amid political turbulence.
