US President Donald Trump announced intensified operations against narcotraffickers in Venezuela, including imminent ground actions following the interception of a Venezuelan oil tanker holding two million barrels. Additional US attacks on Venezuelan shipments are anticipated, injecting further uncertainty into supply dynamics. Concurrently, Russia reiterates that a ceasefire in Ukraine hinges on Ukrainian troop withdrawals from Donbas, a condition rejected by President Volodymyr Zelensky. Russian naval strikes near Odesa continue, with Moscow threatening to sever Ukraine’s maritime access, prompting the European Union to enact emergency measures blocking the return of frozen Russian Central Bank assets to Moscow.
The combined effect of these geopolitical developments has reduced the oil market’s risk premium, suggesting cautious optimism regarding peace efforts, as noted by analysts at Ritterbusch. Nonetheless, persistent regional tensions maintain downward pressure on prices. Market participants also monitor global supply-demand fundamentals, including inventory data and economic indicators, with China’s weaker growth outlook adding to bearish sentiment.
Shares of Petrobras followed the commodity’s decline, closing around 3% lower both in Brazilian markets and as ADRs in New York. Other international oil majors including Exxon Mobil, Chevron, Shell, and TotalEnergies recorded similar losses amid the commodity sell-off. Industry analysts highlight the ongoing sensitivity of exploration and production stocks to crude price fluctuations, especially as markets navigate uncertain supply constraints and geopolitical risks. The approach of year-end has led to energy prices settling significantly below early 2025 levels, with Brent crude approximately $10 cheaper per barrel compared to January of this year, reflecting broad market recalibration.
This article was curated and published as part of our South American energy market coverage.
