Oil prices declined on Wednesday after U.S. President Donald Trump announced that the United States had agreed to import $2 billion worth of crude oil from Venezuela. The deal is expected to add fresh supply to the world’s largest oil-consuming market.
Brent crude futures fell 64 cents, or 1.1%, to $60.06 per barrel by 05:50 GMT. U.S. West Texas Intermediate crude dropped 82 cents, or 1.4%, to $56.44 per barrel.
Both benchmarks extended losses of more than $1 from the previous session, as traders continued to price in a well-supplied global oil market for the year ahead.
The agreement could initially involve rerouting shipments that were originally destined for China. Venezuela is believed to be seeking buyers for millions of barrels currently held in tankers and storage facilities, aiming to reduce the risk of further escalation with Washington.
Prior to the deal, Trump had warned that Venezuela must allow U.S. oil companies greater access or face the threat of increased military pressure. Over the weekend, U.S. forces captured Venezuelan President Nicolas Maduro, an event that further unsettled markets.
Analysts said the agreement is likely to keep oil prices under pressure in an already oversupplied market.
Yang An, an analyst at Haitong Futures, said Venezuelan exports to the United States have primarily disrupted the U.S. market and are expected to deepen the global supply glut.
Meanwhile, analysts at Morgan Stanley estimate the oil market could face a surplus of up to 3 million barrels per day in the first half of 2026. Their outlook reflects weak demand growth last year alongside rising output from both OPEC and non-OPEC producers.
However, analysts at BMI, a unit of Fitch Solutions, noted that an influx of low-cost Venezuelan crude could slow investment and capacity expansion in U.S. oil production and other regions.
Venezuela has recently been selling its flagship Merey crude at a steep discount of around $22 per barrel below Brent prices for delivery at its ports.
According to BMI analysts, this dynamic could eventually support higher oil prices over the medium term, particularly if the current Venezuelan government remains in place.
