NEW YORK — Oil prices edged higher on Sunday as global markets reacted to the dramatic U.S. military intervention in Venezuela, where forces captured the country's leader, Nicolás Maduro, in a move announced by President Donald Trump. The capture, which occurred on Saturday, sent ripples through energy markets, with traders balancing the risks of heightened geopolitical instability against the potential for increased oil supply from Venezuela's vast reserves.
West Texas Intermediate crude, the U.S. benchmark, initially dipped before climbing about 30 cents per barrel, or 0.6%, to settle around midday trading. Brent crude, the international standard, fared slightly better, rising roughly 40 cents, or 0.7%. These modest gains reflected a cautious sentiment among investors, who were digesting Trump's post-capture remarks about reshaping Venezuela's oil sector.
"We’re going to have our very large United States oil companies, the biggest anywhere in the world, go in, spend billions of dollars, fix the badly broken infrastructure and start making money for the country," Trump said Saturday, according to reports from the White House briefing following the operation. The president's comments hinted at ambitious plans to revive Venezuela's energy industry, which has languished under years of economic sanctions, mismanagement, and underinvestment.
The U.S. operation, described by administration officials as a targeted strike to remove Maduro amid ongoing political turmoil, unfolded in the early hours of Saturday in Caracas. Venezuelan state media confirmed the capture but provided few details, while U.S. officials emphasized it was part of broader efforts to restore democracy in the oil-rich nation. As of Sunday evening, Maduro's whereabouts remained undisclosed, with sources close to the administration saying he was in U.S. custody pending further legal proceedings.
Traders appeared to be weighing two primary forces at play. On one hand, the intervention has introduced significant uncertainty, raising fears of a power vacuum in Latin America and potential military escalation. Such instability could disrupt global oil flows, particularly if it spills over into neighboring countries or affects shipping routes in the region. Analysts noted that any prolonged conflict might echo past disruptions, like those seen in the Middle East, driving prices upward as supply concerns mount.
On the other hand, the ouster of Maduro opens the door to tapping Venezuela's enormous oil reserves, estimated by the U.S. Energy Information Administration to be the world's largest at over 300 billion barrels—surpassing those of Saudi Arabia, Iran, Iraq, and the United Arab Emirates combined. Under Maduro's regime, production has plummeted from around 3 million barrels per day in the early 2000s to less than 700,000 barrels daily in recent years, due to crumbling infrastructure and international sanctions imposed since 2017.
Restoring even a fraction of that capacity, however, won't happen overnight. According to estimates from Venezuela's state-controlled oil company, Petróleos de Venezuela S.A. (PDVSA), bringing the energy sector back to 1990s levels would require at least $8 billion in direct investment. That figure doesn't account for the billions more needed for modernizing pipelines, refineries, and drilling operations, which have deteriorated amid hyperinflation and corruption scandals that have plagued the country since the early 2010s.
Major oil companies, including ExxonMobil and Chevron, have long eyed Venezuela's resources but pulled back due to political risks and U.S. sanctions that barred dealings with the Maduro government. Now, with the regime toppled, industry executives are reportedly in early discussions with the Trump administration about potential partnerships. One unnamed oil executive told Reuters on Sunday that while opportunities exist, "the risks are enormous—political, logistical, and financial."
The broader market mood remained subdued, with futures for the S&P 500 and Nasdaq 100 indexes opening only fractionally higher at 6 p.m. ET on Sunday, signaling limited enthusiasm for riskier assets. This caution extended to commodities, where safe-haven investments like precious metals saw sharp gains. Gold prices surged more than $70 per ounce, or over 1.6%, while silver jumped nearly 5%, as investors sought refuge amid the unfolding crisis.
OPEC, the Organization of the Petroleum Exporting Countries, of which Venezuela is a founding member, responded minimally to the events. In a statement released Saturday evening, the cartel announced it would hold its collective oil output steady at current levels, producing no immediate comment on the Venezuelan developments or their implications for global supply. OPEC+ allies, including Russia, have been coordinating cuts to prop up prices, but the group's decision underscores the delicate balance in a market already facing oversupply pressures.
Even before the U.S. intervention, the oil market was grappling with a glut. In 2025, both U.S. crude and Brent posted their largest annual price drops since 2020, falling more than 20% amid booming U.S. shale production and slowing demand from China. Saad Rahim, chief economist at the commodity trading firm Trafigura, warned late last year of a potential "super glut" that could push prices even lower, regardless of geopolitical shifts. "Supply is outpacing demand at an unprecedented rate," Rahim said in a recent interview, a view that some traders echoed Sunday as they bet against a sustained rally.
Venezuela's plight traces back to the 2014 oil price crash, which hammered its petro-dependent economy and triggered a humanitarian crisis. Hyperinflation soared above 1 million percent in 2018, leading to mass migrations and widespread shortages. The U.S. has recognized opposition leader Juan Guaidó as interim president since 2019, but Maduro clung to power with support from Russia, China, and Iran—nations that have provided loans in exchange for discounted oil.
The capture of Maduro marks a pivotal shift, but questions linger about the transition. U.S. officials said Saturday that American forces would withdraw once a stable government is in place, potentially involving Guaidó or a new coalition. International reactions were mixed: Brazilian President Jair Bolsonaro praised the move as a blow to socialism, while leaders in Mexico and Cuba condemned it as an act of imperialism. The United Nations Security Council scheduled an emergency session for Monday to discuss the implications.
Looking ahead, the path to revitalizing Venezuela's oil sector remains fraught. Securing investment will be challenging in an era where oil majors are slashing capital expenditures to appease shareholders focused on dividends over expansion. As one energy analyst at JPMorgan noted, "Venezuela could be a goldmine, but it's buried under layers of risk that no one wants to dig through lightly." If U.S. companies do step in, as Trump suggested, it could reshape alliances in the Western Hemisphere and alter global energy dynamics for decades.
For now, markets are holding their breath. With trading resuming in full force Monday, analysts predict volatility as more details emerge about the post-Maduro landscape. Whether this leads to higher prices from instability or lower ones from unleashed supply depends on how quickly order is restored—and who ultimately controls the taps on the world's largest oil reserves.