Washington: Global oil markets fell on Wednesday after US President Donald Trump announced that Venezuela would transfer between 30 million and 50 million barrels of crude to the United States, a move that added to concerns over already ample global supply.
Brent crude, the international benchmark, dropped around 1% to just over $60 a barrel, while US West Texas Intermediate (WTI) crude fell about 1.4% to near $56.4 a barrel, extending losses from earlier sessions, reported The Guardian.
Trump said the oil — which has been stranded in tankers and storage facilities because of US sanctions and export blockades — would be brought to American ports and sold at market price, with the proceeds used “to benefit the people of Venezuela and the United States.” The president said he had given orders for the plan to be implemented immediately.
The anticipated influx of Venezuelan crude into the U.S. market heightened fears of a supply glut, particularly at a time when global output remains strong and demand growth is modest, prompting traders to lower price expectations.
The decision also carries geopolitical implications. Venezuela’s crude has been primarily destined for China, and rerouting it to the US may strain relations in the broader strategic rivalry between Washington and Beijing. China has criticised the US move as a violation of Venezuelan sovereignty and international law.
Trump’s announcement came in the context of recent US military and political actions in Venezuela, including the capture of then-President Nicolás Maduro. The president has indicated that US energy companies could play a role in rebuilding Venezuela’s neglected oil infrastructure, although analysts have warned that restoring production would require significant investment and time.
