Goldman Says Oil Market's Future Just Got Rewritten In Venezuela

Goldman Sachs says the global oil market is facing a subtle but meaningful reset after Venezuela's political upheaval — with near-term price effects still uncertain, but longer-term risks increasingly skewed to the downside as higher supply becomes possible.

In a note shared this week, analysts led by Daan Struyven said the removal of Venezuelan President Nicolás Maduro has introduced "two-sided" risks for oil prices in 2026, while reinforcing a more bearish supply story beyond that horizon.

Maduro Is Out — What Happens To Oil Prices In 2026?

Venezuela's current oil output stands in stark contrast to its historical scale and resource base.

At its peak in the mid-2000s, the country produced roughly 3 million barrels per day, ranking among the world's largest oil suppliers. Venezuela still holds about one-fifth of global proven oil reserves, the largest share of any single country. But years of underinvestment, infrastructure decay, and sanctions have taken a heavy toll.

Over the last decade of Maduro's rule, crude production fell by about 1.5 million barrels per day. Goldman now estimates output has slipped to roughly 800,000 barrels per day, down from about 930,000 barrels per day in late 2025. Policy uncertainty remains central to the outlook.

President Donald Trump said the U.S. will be "very strongly involved" in the future of Venezuela's oil industry, while emphasizing that the embargo on Venezuelan crude "remains in full effect."

Goldman modeled two distinct scenarios for Venezuela's crude production by the end of 2026. "We see ambiguous but modest risks to oil prices in the short run from Venezuela depending on how U.S. sanctions policy evolves," Struyven wrote, noting that output could either edge higher or face renewed disruptions as political control consolidates.

In a downside scenario where production gradually declines by 0.4 million barrels per day by end-2026—due to storage bottlenecks, lack of blending components, or continued export disruptions—Goldman estimates Brent and WTI – with the latter tracked by the United States Oil Fund (NYSE:USO) – would average $58 and $54, about $2 above its base forecast.

Conversely, if production rises by 0.4 million barrels per day, aided by higher diluent imports, repairs to wells and upgraders, and an eventual lifting of the U.S. oil embargo, Brent and WTI could average $54 and $50 in 2026, roughly $2 below the baseline.

Oil’s Long-Run Outlook Skews Bearish

Beyond 2026, Goldman sees a clearer imbalance forming. Alongside recent production increases in Russia and the United States, the possibility of a gradual recovery in Venezuela adds to medium- and long-term supply pressures.

In a scenario where Venezuelan output climbs to 2 million barrels per day by 2030 — versus 900,000 barrels per day in Goldman's base case — the bank estimates roughly $4 per barrel of downside to its $80 Brent forecast for that year.

A slow return of Venezuela's heavy, diesel-rich crude could also weigh on one of the energy market's strongest structural themes: bullish diesel margins. Additional heavy barrels would increase supply precisely where refiners have benefited from prolonged scarcity.

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