Maduro is out. Uncertainty is in. What will US involvement in Venezuela mean for investors and the oil industry? Well, the answer is both “a lot,” and “a little.” Investors need to know the whole story to adjust to the new setting.
Here, we’ll break down the state of the Venezuelan oil industry, how investors may want to respond, and the emerging risks.
Let’s drill down.
What Happened In Markets This Week?
Here’s a quick summary of what’s been going on:
🥈 Silver goes over US$90/oz as Fed chaos sends investors to hard assets ( Forbes )
- Silver went as high as US$93/oz – its highest ever – as investors piled into metals following a DOJ probe into Fed Chair Powell.
- The spike is also tied to China’s silver export limits, industrial demand from AI and EV sectors, and safe-haven flows.
- With the Fed’s independence now being openly questioned, silver is becoming the risk hedge of choice – more volatile than gold, but also faster-moving.
- Traders might have to brace for turbulence: CME raised margin requirements after the surge.
- The setup echoes early 2021’s silver squeeze… except this time, the drivers are institutional and not Reddit-fueled.
🇹🇼 Taiwan to pour $250B into US chipmaking under new trade deal ( CNBC )
- Taiwanese firms will invest $250B to build fabs in the US, and get major tariff relief in return.
- TSMC (TSM) is expanding in Arizona, with US officials aiming to relocate 40% of Taiwan’s chip supply chain stateside.
- Companies that don’t comply could face 100% tariffs – a sharp push to localize critical tech.
- For investors, this isn’t just supply chain diversification – it’s a geopolitical reshuffle with clear winners in US-based chip infrastructure.
- This deal could be a game-changer for US fabless chipmakers too, reducing lead times and derisking geopolitical exposure.
💸 Saks Global files for bankruptcy after Neiman merger flop ( CNBC )
- The Saks-Neiman marriage unraveled fast, with Saks Global filing Chapter 11 just 18 months after the $2.7B merger.
- Cash dried up, vendors panicked, and Amazon’s $475M investment is now a write-off.
- The company has lined up $1.75B in financing to restructure and cut stores, led by Neiman’s former CEO.
- This is a cautionary tale for investors betting on luxury retail scale-ups in a market that’s getting tighter.
- Credit markets may tighten further for retail rollups, especially those relying on private equity-style debt loads.
🛒 Alibaba rallies on AI shopping spree ambitions ( IBD )
- Alibaba (BABA) shares are up 12% this week after showcasing new AI-powered shopping tools and voice-based product search.
- The company is doubling down on its Qwen chatbot and open-source AI model, aiming to simplify purchases across its vast e-commerce platforms.
- Backed by a planned $53B AI infrastructure spend, the push signals a strategic shift to product-led growth over cost cuts.
- With shares still far off their 2020 peak, this could be the beginning of a re-rating if it translates to real revenue.
- Investors should watch whether Alibaba can drive transaction volume and margin expansion, or if AI ends up just boosting engagement.
🛫 Boeing beats Airbus in orders for first time since 2018 ( CNBC )
- Boeing (BA) landed more net orders than Airbus (AIR) in 2025, snapping a 7-year losing streak thanks to fewer cancellations and big wins from U.S. and Indian carriers.
- Gross orders still favor Airbus, and Boeing lags in deliveries, but the turnaround in sentiment is real.
- Execution remains under scrutiny – 737 MAX hiccups haven’t gone away, and supply chains are still tight.
- It’s a step forward for Boeing bulls, but far from a clean slate.
- Investors should look for signs of operational follow-through before treating this as a full recovery story.
🛢️The State of Venezuela’s Oil Industry Then and Now
📈 Immediate Market Reactions
Interestingly, only a few oil stocks have actually moved on the news of U.S. military action and the capture of Nicolás Maduro.
They include the three largest US oil companies: Chevron (CVX) surged about 5%, ExxonMobil (XOM) shares jumped by about 2.5%, and ConocoPhillips (COP) increased by roughly 3.1%. No other oil companies experienced any major moves after the US took action.
The market’s muted reaction is not that surprising, given that the country is a relatively small player in global oil production. In 2007, then-President Hugo Chavez significantly increased state control of the industry by forcing foreign oil companies to give up majority stakes.
As a result, the country seized assets from oil companies, driving out ExxonMobil and ConocoPhillips. Chevron was the sole US company to agree to the change.
Today, the company produces 20% to 25% of Venezuela's total oil output. Meanwhile, ExxonMobil and ConocoPhillips continue to seek recovery of $1.65 billion and $12 billion, respectively, in lost assets.
📖 The Backstory
Venezuela produces about 800,000 barrels per day (bpd) – just under 1 percent of current global production.
In contrast, the US produces about 13 million bpd of crude oil. Saudi Arabia and Russia hold the second- and third-largest spots at 11 million and 10 million bpd, respectively.
Venezuela’s crude oil production dropped dramatically around 2017 when the US placed sanctions on the country. This move was a reaction to growing repression in the country as Maduro attempted to consolidate power. Even before the sanctions, nearly every US oil company has stayed away from Venezuela given the country’s history of nationalizing assets. It’s not surprising that Exxon CEO Darren Woods recently told Trump that Venezuela is “uninvestable” under today’s conditions.
⚖️ Supply Uncertainty vs. Future Production Potential
While Venezuela's oil production remains dismal, the country has more than 300 billion barrels of proven oil reserves, giving the industry significant potential. Though there are questions around the accuracy of this number.
Turning potential into profits is a different story however, and will require many years and billions of dollars. With sufficient investment and time, the country could reach a level of production roughly equal to Canada's or Iraq's, which both produce about 5 million bpd . While this output would put the country in the top 10, it’s hardly a game-changer for the industry.
Pulling those reserves from the ground and refining them appears to be a long shot. Consider that “just to maintain production at current levels to 2040 would require about $65 billion and northward of $100 billion just to get Venezuelan production back to 2 million barrels per day,” according to an analyst at energy consultancy Rystad. Even Chevron has no plans for expansion.
💰 Ways to Play Current Events
📊 How Oil Prices and Volatility May Change
Intraday oil prices and volatility have seen little change since the US took action. While the potential for more oil from Venezuela could bring oil prices down, the numbers suggest otherwise. The reason: Demand from the US and China is likely to climb over the course of this year.
Data from State Street forecasts only an additional 250-300k bpd day from Venezuela, against an increase in global oil demand of 750k-1.25 million bpd. Put simply, any extra oil from Venezuela will likely have no material impact on the global supply/demand picture.
At the moment, it’s unclear who would provide this financial backing. Given Venezuela’s history and deteriorating infrastructure, it seems unlikely that any country or company would be interested in investing in projects with uncertain and limited outcomes.
🎯 Other Sectors and Markets That May Be Impacted
While Chevron, ExxonMobil, and ConocoPhillips all saw their share prices jump after Maduro’s capture, all three have come down from those levels. For now, the leadership shakeup in Venezuela appears to have little to no impact on oil stocks. This lack of change is due not only to Venezuela’s small share of global oil production but also to the declining oil intensity of global GDP. Oil consumption relative to GDP has been declining consistently since 1990.
💸 Debt Markets
However, other investments may respond to Trump’s reach into the country. For example, Venezuelan debt may become less of a credit risk than it was before US involvement. With Maduro out and the US stating its intent to invest in the country, Venezuela’s economy may improve, enabling it to finally repay creditors.
"There are much, much greater upsides in the bond market than what investors went to sleep thinking they were on Friday," says Eric Fine, emerging-markets portfolio manager at VanEck Funds. The bet here is that future elections will result in leadership that’s more focused on the markets.
⛏️ Precious Metals
The story in Venezuela has only added to the uncertainty in an already volatile geopolitical setting. Therefore, precious metals, a traditional way to hedge against uncertainty, have continued their rise, which was well underway before Maduro’s removal. Gold and copper prices increased, and silver captured a new record high.
Could US involvement in Venezuela unlock critical minerals? The answer is unclear, but Venezuela’s partnerships with China offer some answers. The USGS 2025 Mineral Commodity Surveys do not indicate that the country has significant reserves of coltan (used in capacitors for military communications equipment), bauxite (used in aluminum-based aerospace applications), or rare earth elements. However, research by J.P. Morgan suggests that Chinese buyers may be working directly with the Venezuelan military to acquire critical minerals from the country.
As Michael Cembelest, Chairman of Market and Investment Strategy at J.P. Morgan writes, “it’s notable that China, which controls the vast majority of critical mineral mining and processing activities around the world, is active in Venezuela.”
For now, it’s unclear whether the US or any other country will yield substantial amounts of minerals or rare earths from the government.
💣 Weapons Manufacturers
Trump’s action indicates he’s serious about exerting control abroad. In recent days, many have cited the “Donroe Doctrine.” This stance is an adaptation of the Monroe Doctrine. The Donroe Doctrine represents Trump’s desire to assert American predominance throughout the Western Hemisphere. As moves like the one in Venezuela become more aggressive, US weapons manufacturers are seeing share prices climb. Companies like Lockheed Martin, Boeing, RTX Corp., and General Dynamics all saw their share prices rise on the news of Maduro’s capture.
⚠️ Investment Risks in Oil Post-Action
🚨 The Outlook for Oil
As Morgan Stanley explains, “Lower oil prices resulting from greater supply would have negative implications for major oil producers.” If US involvement in Venezuela eventually boosts oil production meaningfully, we could see oil prices fall. This fall, in turn, would likely push down oil company share prices. Meanwhile, producers like Canada could see increased competition given that the oil they produce is similar to Venezuela's.
It’s important to remember that more oil flowing from Venezuela is not necessarily good for the global economy. The globe is already producing more oil than it needs. The International Energy Agency (IEA) explained that “The overall oil surplus averaged 1.9 million barrels per day (mb/d) from January through September 2025.” The IEA expects this figure to rise this year to 4 million bpd as supplies from the Middle East and the Americas surge.
Global Oil Supply - IEA
⚖️ An Inelastic Market
More oil from Venezuela will only intensify the oversupply. Moreover, even an aggressive output from the country, which would require billions in investment, will not alter pricing much given the current market conditions. Experts at the IEA explain that "Oil demand is inelastic by nature, meaning that it takes large oil price moves to impact demand in the short term materially. For example, a lasting 10% rise in oil prices would roughly reduce global oil consumption by around 0.3%."
This inelastic demand means that changes in supply can have significant effects on price — when supply increases substantially, prices must fall considerably to induce consumers to absorb the additional oil, since demand doesn't respond strongly to price changes. However, if the current supply glut rises, as expected, higher-cost producers may reduce spending, which could diminish the prospects for investors in those companies.
✨ The Insight: Recent Events Say More About Uncertainty Than They Do Oil
The bottom line is that recent events in Venezuela will have little or no impact on the broader oil industry or publicly traded oil companies. Trump may pressure US oil companies to invest in Venezuela, but making such a commitment is a long-term investment that will connect oil companies to the country long after Trump is able to exert his influence. Therefore, US oil companies are unlikely to agree to Trump’s demands. However, Trump’s brazen move to capture Maduro demonstrates his willingness to execute his so-called Donroe Doctrine which would introduce even more uncertainty to the market.
Investors are now considering whether Trump may take further action in Iran, Cuba, or even Greenland. Such moves were widely regarded as unlikely, but in the wake of this recent move, they all seem possible. The sum of these concerns leaves us in a market that’s likely to experience more volatility throughout 2026.
In addition to Trump’s moves, the world still faces the chance that China invades Taiwan, a possible bursting of the AI bubble, and Putin’s ambitions to widen his war. Against this backdrop, investors need to be prepared. In recent years, the US equities market has surged, and in 2025, European markets performed even better. While the momentum may continue, valuations are historically high.
💡So, what do investors do?
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Keep an eye on volatility: Watch the CBOE Volatility Index (VIX) - sometimes called the “fear index.” The index’s median since its creation in 1990 is 19.5. When the VIX rises far above this number, investors are more fearful. When it falls below 19.5, investors are less afraid. If the VIX surges, it might be a good time to put sideline cash back into the market as investors panic-sell.
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Filter for long-term potential: Prioritize companies and sectors less exposed to today’s intensified geopolitical risks. Healthcare, consumer staples, and utilities are good examples.
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Avoid home bias: the tendency for investors to favor domestic investments over foreign ones. This leaning can limit an investor’s diversification. In a less certain setting, diversification is essential.
Key Events Next Week
Monday
🇨🇳 China GDP Growth Rate (Q4)
- 📉 Forecast: 4.6% , Previous: 4.8%
- ➡️ Why it matters: China’s growth trajectory sets the tone for global demand. Any downside surprise would pressure commodities and exporters, while a resilient print could lift sentiment across Asian and Australian markets.
Tuesday
🇨🇦 Canada Inflation Rate YoY (Dec)
- 📈 Forecast: 2.1%, Previous: 2.2%
- ➡️ Why it matters: Inflation hovering near target gives the Bank of Canada more flexibility. A softer print would strengthen expectations for rate cuts and support rate-sensitive assets.
Wednesday
🇬🇧 UK Inflation Rate YoY (Dec)
- 📈 Forecast: 3.1%, Previous: 3.2%
- ➡️ Why it matters: UK inflation remains well above target. A slower pace would ease pressure on the Bank of England, while a sticky reading keeps rate cuts on hold and weighs on growth expectations.
Friday
🇺🇸 US GDP Growth Rate QoQ (Q3, Final)
- 📉 Forecast: 4.3%, Previous: 3.8%
- ➡️ Why it matters: This confirms how strong the US economy was heading into year end. Markets will focus on whether growth is cooling fast enough to support Fed rate cuts in 2026.
Earnings season is ramping up this week with these companies due to report:
- Johnson & Johnson (JNJ)
- Netflix (NFLX)
- Visa (V)
- LVMH-Moet Hennessy (MC)
- Procter & Gamble (PG)
- Intel (INTC)
Until next week, invest well.
Simply Wall St
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Simply Wall St analyst Stella and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
