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US oil company shares jump on Venezuela developments
Shares in US oil companies have jumped at the start of trading, as investors anticipate opportunities in Venezuela following the removal of Nicolás Maduro last weekend.
Chevron, the American energy giant, is up 4.4% on Wall Street – reflecting predictions that, as the only major US oil company operating in Venezuela, it is in pole position to profit from the upheaval.
Rivals ExxonMobil (+2%) andConocoPhillips (+4.1%) are also among the top risers in New York, as analysts predict that the US intervention in Venezuela as a positive development for its oil companies.
But while Donald Trump’s administration is determined to access Venezuela’s energy reserves, there are also warnings that billions of dollars must be spent to rebuild its infrastructure, before its heavy oil can be shipped to US refineries.
Morningstar’s director of equity research, Allen Good, explains:
“Venezuela has substantial oil reserves, reportedly larger than those of Saudi Arabia, making it appealing to US oil companies. Currently, Chevron is the only major US operator remaining in Venezuela, since Exxon and ConocoPhillips left in 2007 after the government nationalised their assets. Given its significant presence - holding stakes in four key joint ventures and an offshore gas field which may now be fully developed - Chevron is best positioned to benefit from US involvement in Venezuelan crude restoration projects. Although the company paused reporting on production or reserves, current reports suggest that Chevron exports around 150,000 barrels of oil per day under current US licenses.
Exxon and ConocoPhillips have sought billions in remuneration through arbitration since leaving the country but have had little success collecting this. Opening the country could potentially allow for re-entry and collection of awards or restoration of assets.
Although the US interest makes sense initially, following years of neglect and sanctions, Venezuela’s oil industry will require tens of billions in investment to lift production meaningfully. Furthermore, the bulk of its reserves are extra-heavy oil, which is costly and capital-intensive to extract. Oil companies will need to be cautious about deploying capital until there is greater regulatory and contractual certainty. While Chevron may be able to add incremental production in the near term with US approval, meaningful volume increases are likely years away. With this in mind, the possibility of US companies developing Venezuela’s oil reserves remains far from certain.”
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The US intervention in Venezuela is another sign we are in a more interventionist, less predictable world, says Aneeka Gupta, director of Macroeconomic Research at asset manager WisdomTree.
Gupta adds:
It underscores that the US remains prepared to project hard power well beyond its borders, and that major powers are once again competing over energy routes and spheres of influence.
For European governments, which sit alongside Ukraine, the Middle East, and tensions in the Red Sea, this serves as further evidence that hard power and deterrence are once again central to foreign policy, not a discretionary afterthought.
European markets hit record high
Europe’s benchmark Stoxx 600 index has hit the 600-point mark for the first time, as global stocks continued their strong recent run.
The pan-continental index was up 0.7% on the day to hit a record of 600.16 points, led by gains in the technology and mining sectors, as investors reacted calmly to the capture of Venezuelan president Nicolas Maduro at the weekend.
The Dow Jones Industrial Average hit a record high today despite signs that America’s manufacturing sector is struggling.
US factory output contracted in December for the 10th straight month, according to the ISM Manufacturing PMI which has dropped to 47.9%, the lowest reading of 2025, down from 48.2% in November.
Susan Spence, MBA, chair of the Institute for Supply Management manufacturing business survey committee, says:
In December, U.S. manufacturing activity contracted at a faster rate, with pullbacks in the Production and Inventories indexes leading to the 0.3-percentage point decrease of the Manufacturing PMI.
Those two subindexes increased in November, so their contraction this month continues the short-term “bubble” of improvement indicative in the last several months of PMI® data — and a hallmark of recent economic uncertainty in manufacturing.
Venezuela's bond rally hands windfall to hedge funds
The rally in Venezuela’s government bonds today means investors who snapped up the distressed debt are already in profit – but they may expect more!
Defaulted notes issued by Venezuela and its state-run oil company PDVSA jumped early Monday, with sovereign bonds due in 2027 up 7 cents on the dollar — or 22% — in the biggest gain since 2023.
That pushed them to 40 cents, double where they were just six months ago but still below what investors see as a potential recovery value if the country moves to restructure its debts.
[Reminder: prices were so low because Venezuela defaulted in 2017, but some hedge funds have been buying this debt, gambling that it could be worth more in a future debt restructuring].
Dow hits intraday record high
The jump in Chevron’s share price has helped to lift the US stock market to a record high.
The Dow Jones industrial average has risen by more than 1% to a new intraday record high in New York trading this morning, hitting 49,001 points for the first time.
Banks are also rallying, with Goldman Sachs up 4.5% and JP Morgan gaining 2.9%.
A more pro-Western Venezuela, following the abduction of Nicolás Maduro, could eventually lead to higher oil output and improved energy security.
Janus Henderson analysts explain:
“The unfortunate impact of the economic and political difficulties Venezuela has faced for the past two decades on top of sanctions means that many developed market companies have completely exited the market. For the few with residual exposure to Venezuela (e.g. Chevron, Repsol, Telefónica) a more stable policy backdrop could provide incremental relief.
“In the near term, Venezuelan bonds may see initial support as markets price in the prospect of policy normalisation (assuming the country avoids chaos – early indications are that the U.S. may be willing to work pragmatically with the existing Venezuelan authorities after the challenges faced in Iraq and Afghanistan). Oil markets could also react, though not necessarily in the direction one might expect. While geopolitical uncertainty often pushes prices higher, an eventual increase in Venezuelan supply would exert downward price pressure on crude – once shipping routes stabilize and sanctions pathways become clearer.
“A transition towards a pro-Western government might ease sanctions, enable foreign investment (although this may require a change in attitude among Venezuela’s current regime or a change of regime altogether), and increase output. It is possible that with outside help and favorable political conditions, Venezuela could double production to 2 million barrels/day within two years and meaningfully more in the longer run. Such an expansion would alter the global oil balance. It is not difficult to see why Venezuela moving under the aegis of the U.S. could improve energy security for the U.S and by extension the West.”
US oil services company Halliburton’s shares have jumped 7%, as Wall Street traders anticipate it will be involved in the development of Venezuela’s oil infrastructure.
The S&P 500 energy sector has hit highest level in over a year, Reuters reports, and is up 2.4% today.
US oil company shares jump on Venezuela developments
Shares in US oil companies have jumped at the start of trading, as investors anticipate opportunities in Venezuela following the removal of Nicolás Maduro last weekend.
Chevron, the American energy giant, is up 4.4% on Wall Street – reflecting predictions that, as the only major US oil company operating in Venezuela, it is in pole position to profit from the upheaval.
Rivals ExxonMobil (+2%) andConocoPhillips (+4.1%) are also among the top risers in New York, as analysts predict that the US intervention in Venezuela as a positive development for its oil companies.
But while Donald Trump’s administration is determined to access Venezuela’s energy reserves, there are also warnings that billions of dollars must be spent to rebuild its infrastructure, before its heavy oil can be shipped to US refineries.
Morningstar’s director of equity research, Allen Good, explains:
“Venezuela has substantial oil reserves, reportedly larger than those of Saudi Arabia, making it appealing to US oil companies. Currently, Chevron is the only major US operator remaining in Venezuela, since Exxon and ConocoPhillips left in 2007 after the government nationalised their assets. Given its significant presence - holding stakes in four key joint ventures and an offshore gas field which may now be fully developed - Chevron is best positioned to benefit from US involvement in Venezuelan crude restoration projects. Although the company paused reporting on production or reserves, current reports suggest that Chevron exports around 150,000 barrels of oil per day under current US licenses.
Exxon and ConocoPhillips have sought billions in remuneration through arbitration since leaving the country but have had little success collecting this. Opening the country could potentially allow for re-entry and collection of awards or restoration of assets.
Although the US interest makes sense initially, following years of neglect and sanctions, Venezuela’s oil industry will require tens of billions in investment to lift production meaningfully. Furthermore, the bulk of its reserves are extra-heavy oil, which is costly and capital-intensive to extract. Oil companies will need to be cautious about deploying capital until there is greater regulatory and contractual certainty. While Chevron may be able to add incremental production in the near term with US approval, meaningful volume increases are likely years away. With this in mind, the possibility of US companies developing Venezuela’s oil reserves remains far from certain.”
The copper price has surged to a record high today, helped by worries of supply shortages and tariff fears.
In London, the benchmark copper price hit $13,000 a tonne for the first time, up over 4% today.
That follows a strong 2025; copper, which is widely used in industry including for renewable energy projects and data centres, surged by 42% last year.
Today’s rally comes after a strike began at the Mantoverde mine in Chile last Friday, and as investors worry that Donald Trump might impose tariffs in copper this year. Those tariff worries have encouraged traders to ship copper to the US now.
Elsewhere in the energy sector, US natural gas futures have dropped by as much as 6% today.
That should help push down US inflationary pressures. But rather than being a reaction to events in Venezuela, Bloomberg attribute it to forecasts for warmer temperatures next week, which is likely to reduce demand for the fuel.
