Oil steadies as Venezuelan supply disruptions run counter to global oversupply fears

Oil prices were little changed on Monday as investors weighed supply disruptions linked to rising tensions between the United States and Venezuela against concerns over excess supply and the potential impact of a peace deal between Russia and Ukraine.

Brent crude futures fell $0.20, or 0.33%, to $60.92 a barrel by 13:01 GMT, while US West Texas Intermediate crude slipped $0.21, or 0.37%, to $57.23 a barrel.

Both benchmark contracts dropped more than 4% last week, pressured by expectations of a global oil supply surplus in 2026.

John Evans, an analyst at PVM, said the gradual decline in oil prices and the move to the lowest levels since the start of the month across major futures complexes last week could have been sharper were it not for the United States stepping up pressure related to Venezuela.

Shipping data, documents, and maritime sources showed that Venezuelan oil exports fell sharply after the United States seized an oil tanker last week and imposed new sanctions on shipping companies and vessels dealing with the Latin American producer.

Markets are closely monitoring developments and their potential impact on oil supplies after Reuters reported that the United States intends to intercept more vessels carrying Venezuelan oil following the tanker seizure, increasing pressure on President Nicolas Maduro.

In a related development, Ukrainian President Volodymyr Zelenskiy offered to abandon his country’s bid to join NATO during five hours of talks with US envoys in Berlin on Sunday, with negotiations set to continue on Monday.

US envoy Steve Witkoff said that “a lot of progress has been made,” without providing further details.

Any potential peace agreement could eventually lead to higher Russian oil supplies, which are currently under sanctions imposed by Western countries.

Tsuyoshi Ueno, chief economist at NLI Research Institute, said peace talks between Russia and Ukraine are swinging between optimism and caution, while tensions between Venezuela and the United States are rising, raising concerns about potential supply disruptions.

At the same time, expectations of a supply surplus continued to weigh on prices.

JPMorgan’s commodities research unit said in a note on Saturday that oil surpluses expected in 2025 are likely to widen further in 2026 and 2027, with global oil supply growth forecast to outpace demand growth by a factor of three through 2026.