Oil Prices Drop on Expected Crude Supply Boost
Oil prices dropped in the global markets on Tuesday as U.S. talks with American oil companies on Venezuela fuelled expectations that additional crude supply could return to global markets.
Brent crude traded at $61.50 per barrel, down 0.30% from Monday’s close of $61.70. US benchmark West Texas Intermediate (WTI) was at $57.99 per barrel, down around 0.33% compared to $58.13.
A senior White House official told Anadolu Agency that correspondence with companies has started and will continue, adding that US Energy Secretary Chris Wright and Secretary of State Marco Rubio will lead the talks on behalf of President Donald Trump.
“As President Trump has stated, he is looking forward to working with American oil companies on new investments and opportunities in Venezuela,” said White House Spokesperson Karoline Leavitt.
Trump previously said on Jan. 3, following a major military intervention against Venezuelan President Nicolas Maduro, that the US would be strongly involved in Venezuela’s oil sector. Trump said these firms would repair oil infrastructure with investments worth billions of dollars and revive production.
US administration’s engagement with American oil companies on Venezuela has limited the geopolitical risk premium in the short term, while creating downward pressure on prices in the medium term due to expectations that the country’s oil supply could increase again.
Meanwhile, the decision by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, to maintain current production levels at their weekend meeting sent a signal that no additional supply would enter the market, helping to curb short-term downward pressure on oil prices.
However, a weak global demand outlook and strong growth in non-OPEC production continue to prevent the decision from triggering a sustained rise in prices. Trump not Planning to Occupy or Nation-Build in Venezuela
