Oil markets moved lower on Wednesday, with prices extending recent declines after U.S. President Donald Trump said Washington had reached an agreement that would allow up to $2 billion worth of Venezuelan crude to be imported into the United States. The development is expected to add supply to the world’s largest oil-consuming market and reinforce expectations of a well-supplied global market.
Brent crude futures were down 64 cents, or 1.1%, at $60.06 a barrel by 05:50 GMT, while U.S. West Texas Intermediate crude fell 82 cents, or 1.4%, to $56.44 a barrel. Both benchmarks added to losses of more than $1 from the previous session, as traders continued to price in ample oil availability for the year ahead.
Market sources said the agreement could initially lead to a reshuffling of cargo flows, with shipments previously destined for China redirected toward the U.S. Venezuela is also believed to be seeking to clear millions of barrels currently held in tankers and storage, partly to avoid further escalation in tensions with Washington.
Trump has previously warned that Venezuela must open its oil industry to U.S. companies or face the prospect of heightened military action. Shortly after those warnings, U.S. forces captured Venezuelan President Nicolás Maduro over the weekend.
Analysts broadly expect the deal to keep downward pressure on prices in an already oversupplied market. Yang An, an analyst at Haitong Futures, said Venezuela’s exports to the U.S. have primarily disrupted the American market and are likely to exacerbate the global supply glut.
At the same time, analysts at Morgan Stanley estimate that the oil market could tip into a surplus of as much as 3 million barrels per day in the first half of 2026, citing weak demand growth last year alongside rising output from both OPEC and non-OPEC producers.
However, analysts at BMI, part of Fitch Solutions, noted that an increase in low-cost Venezuelan crude exports could eventually slow investment and capacity expansion in the U.S. and other producing regions. Venezuela has been selling its benchmark Merey crude at a steep discount of around $22 per barrel to Brent for delivery at its ports, a dynamic that BMI said could lift oil price expectations over the medium term, particularly if the current Venezuelan regime remains in place.