Oil prices held steady today as investors balanced supply disruptions linked to escalating US-Venezuelan tensions with oversupply concerns and the impact of a potential Russia-Ukraine peace deal.
Brent crude futures were down 20 cents, or 0.33%, to $60.92 a barrel this afternoon and US West Texas Intermediate crude was at $57.23 a barrel, down 21 cents, or 0.37%.
Both contracts slid more than 4% last week, weighed down by expectations of a global oil surplus in 2026.
“The grind lower in oil prices and the achieving of month-to-date lows across the major futures complex last week might have seen more negative pricing if it were not for the upping of the ante by the United States with regard to Venezuela,” said PVM analyst John Evans.
Venezuela’s oil exports have fallen sharply since the US seized a tanker last week and imposed fresh sanctions on shipping companies and vessels doing business with the Latin American oil producer, according to shipping data, documents and maritime sources.
The market is closely monitoring developments and their impact on oil supply, with Reuters reporting that the US plans to intercept more ships carrying Venezuelan oil following the tanker seizure, intensifying pressure on President Nicolas Maduro.
Ukrainian President Volodymyr Zelenskiy offered to drop his country’s aspiration to join the NATO military alliance as he held five hours of talks with US envoys in Berlin yesterday. Negotiations are set to continue today.
US envoy Steve Witkoff said “a lot of progress was made”, though additional details were not divulged.
A possible peace deal could eventually increase Russian oil supply, which is currently sanctioned by Western countries.
“Peace talks between Russia and Ukraine have swung between optimism and caution, while tensions between Venezuela and the U.S. are escalating, raising concerns about potential supply disruptions,” said Tsuyoshi Ueno, a senior economist at NLI Research Institute.
Rising expectations of a surplus also weighed on prices.
JPMorgan Commodities Research said in a note over the weekend that oil surpluses in 2025 were expected to widen further into 2026 and 2027, as global oil supply was projected to outpace demand, expanding at three times the rate of demand growth during 2026.
