CITIC Securities: US raids on Venezuelan crude oil, confronts disturbances, suggests focusing on oil and gas producers

The Zhitong Finance App learned that CITIC Securities released a research report saying that in the early morning of January 3 EST, the US raided the Venezuelan capital Caracas and detained President Nicolas Maduro and his wife, causing severe political turmoil in the country. As the country with the largest proven oil reserves in the world, exports of Venezuelan crude oil have now been basically suspended, causing supply disruptions to the global market in the short term; combined with onshore storage tanks and offshore floating silos, stocks continue to accumulate, and the pace of oil field production cuts may further accelerate. Geopolitical risks may drive oil prices higher in the short term, but considering that the current global crude oil market is still in a relaxed supply pattern, it is expected that oil prices will still fluctuate at 60 to 70 US dollars/barrel. Considering the short-term supply gap of Venezuelan oil, which may be around 1 million barrels per day, it is expected that oil prices will rise in the short term; it is recommended to focus on oil and gas producers, and it is recommended to focus on asphalt, sulfur, and petroleum coke manufacturers.

CITIC Securities's main views are as follows:

The US raided Venezuela, and crude oil was a core strategic element.

According to Xinhua News Agency, in the early morning of January 3, US Eastern Time, the US launched a military operation codenamed “Absolute Determination” against Venezuela, raided the Venezuelan capital Caracas and took control and transfer of Venezuelan President Nicolas Maduro and his wife to New York in the US. The local political situation was in turmoil, and the Venezuelan vice president took over the presidency. According to Xinhua News Agency, US President Trump said that in the future, the US will “take over” Venezuela and also control Venezuela's oil reserves. According to OPEC, by the end of 2022, Venezuela's proven oil reserves reached 303.4 billion barrels, ranking first in the world. In an interview with Fox News, Trump said that the US will “participate deeply” in the Venezuelan oil industry and allow large US oil companies to enter Venezuela to repair infrastructure. This shows that the current US action is mainly aimed at competing for crude oil resources. Crude oil will once again be on the cusp, and crude oil prices will be greatly disrupted.

American oil companies may be the first to benefit, and Chinese oil and gas companies may face greater risks.

According to Wind, Chevron is an oil giant operated by the US in Venezuela. It exports about 120,000 barrels of crude oil to the US Gulf Coast every day, which has the basis for expanding production. Other US oil companies may wait to see how political stability, operating environment, and contractual frameworks evolve before deciding whether to participate in oil production. CITIC Securities predicts that if the Trump administration can successfully achieve a peaceful transition in Venezuela and the relevant laws to reform the nationalization of its petroleum industry are successfully passed, within five to seven years, with infrastructure repairs and the implementation of investment by US oil giants, Venezuela's oil production may rise back to 2 to 3 million b/d.

The oil cooperation between China and Venezuela began in 1997, mainly with technical support from CNPC. According to CNPC announcements and CITIC Securities estimates, in 2024, the company's oil equity production in Venezuela was about 140,000 b/d, accounting for 3.7% of total crude oil production. According to Xinhua News Agency, after Maduro was taken away, the vice president is now acting in power. Considering the instability of the current administration and the strong intervention of the United States, the CPC Petroleum Cooperation may face multiple risks such as cancellation of contracts, takeover of assets, evacuation of personnel, and transportation disruptions, which pose challenges to some of CNPC's businesses, but the overall impact is expected to be limited.

Crude oil exports to the Commission have been suspended, increasing the risk of short-term supply shocks.

According to Longzhong News, in November 2025, Venezuelan crude oil production was 934 million b/d, down 2.30%; in 2025, the average annual output was 916 million b/d, up 8.57% year on year; in November 2025, Venezuela's crude oil export volume was 653 million b/d, down 16.71% month on month, and the average annual export volume was 728 million b/d, up 10.70% year on year. According to shipping data, Venezuela's oil exports in November 2025 were about 921,000 b/d, of which about 746,000 b/d (80%) was sold to China.

China's oil field interests are mainly held by CNPC, mainly in the Orinoco Heavy Oil Belt and East Venezuela Basin, including the MPE-3, Juning 4, Luhu Project, and Sumano Oilfield. According to CCTV International Times, the country's oil exports have been completely suspended, including suspending tankers leased by its main partner Chevron. CITIC Securities believes that short-term geopolitical turmoil may have a certain supply impact on Chinese refineries and the global market. As Venezuela's onshore oil storage tanks and floating oil storage vessels accumulate more rapidly in recent weeks, the rate of production reduction in the country's oil fields may accelerate.

Geopolitical factors may drive oil prices to rise in the short term, but changes in the relationship between supply and demand will take time.

By cracking down on non-US dollar oil suppliers in the international market, the US is rebalancing the supply and demand pattern for the US dollar and oil in the international market, which will drive up oil prices in the short term. CITIC Securities believes that if all Venezuelan crude oil supply is interrupted in the short term, global crude oil supply will be reduced by 90 to 1 million b/d. Due to geopolitical factors in the short term, oil prices may rise in stages, but considering that global demand is still difficult to increase significantly in the first half of 2026, crude oil prices are expected to fluctuate between 60 and 70 US dollars/barrel in the medium to long term.

Special petroleum products such as asphalt, sulfur, and petroleum coke may rise in price.

Venezuela's crude oil is mostly heavy sulfur-containing crude oil, which produces a lot of specialty products such as asphalt, sulfur, petroleum coke, etc., and domestic market demand is high and supply is insufficient. Local refineries in Shandong have long relied on asphalt and sulfur to obtain profits. As logistics are blocked due to this incident, it is expected that the operating rate of the Shandong refinery will be forced to decline, and production costs for asphalt and other products will surge due to a shortage of raw materials, which may cause the prices of asphalt, sulfur, petroleum coke, etc. to rise again.

Risk factors:

Geopolitical risks exceeded expectations; demand fell short of expectations; risk of overseas economic recession; deterioration of the industry and international policy environment; and global trade frictions exceeded expectations.