World oil prices are forecast to fluctuate only within a narrow range after the US attacked Venezuela and arrested President Nicolas Maduro on January 3, according to many energy industry experts.
Mr. Giovanni Staunovo, a strategist at UBS bank in Switzerland, said that it is still too early to draw a definite conclusion, but Venezuela's exports and oil production are under downward pressure due to the US oil tanker blockade, with the risk of this trend continuing.
Ms. Vandana Hari, CEO of Vanda Insights company based in Singapore, said that the immediate impact on the oil market is not large, mainly reflected in the slight increase in risk compensation related to Venezuela.
US President Donald Trump declared that Washington had launched a large-scale attack, arrested Mr. Nicolas Maduro and sent him and his wife out of the country. The Venezuelan government accused the US's goal of controlling oil and minerals, while affirming that the US would not achieve this goal.
The Trump administration has stepped up its campaign aimed at Venezuela's oil exports through maritime blockades, expansion of sanctions and launched many attacks on ships accused of drug trafficking.
According to Ms. Amrita Sen of Energy Aspects, previous moves have caused Venezuelan production to decrease by about 25%, although the attacks were not directed at oil and gas facilities.
She believes that the impact on oil prices will not be serious because global inventories are expected to increase, although unscheduled supply disruptions in Venezuela, Russia and Kazakhstan are increasing.
Venezuela currently produces about 1.1 million barrels of oil per day, mainly exported to China and India, accounting for nearly 1% of global oil trade.
According to Ms. Amena Bakr of Kpler, the market is underestimating geopolitical risks, but the surplus context raises concerns about reduced supply loss. She predicts oil prices may increase slightly if tensions persist, but the overall impact is still modest, especially because Venezuelan heavy oil is difficult to replace with lighter oils.
Mr. Vijay Valecha from Century Financial warned that the energy market may become volatile when trading opens, as history shows that oil prices often rebound during geopolitical instability.
However, he emphasized that Venezuela's contribution to global supply is small, and the biggest concern of the market lies in the risk of escalating the crisis.
Mr. Robin Mills of Qamar Energy said that oil prices may initially increase, but in the long term, this development is downward-looking, due to Venezuela's ability to expand exports if the political environment changes.
As of 7:00 AM on January 4th Vietnam time, the spot price of WTI oil sold was 57.32 USD/barrel, down 0.17%. The price of light sweet Brent crude oil traded at 60.75 USD/barrel, down 0.16%.
