Oil Prices Dip Following U.S. Military Operation in Venezuela

Jakarta, Pintu News – As reported by CNA, oil prices fell on Monday (January 5) after a US military operation led to the arrest of Venezuela’s leader, Nicolas Maduro – a country with the world’s largest proven crude oil reserves.

Oil prices weaken after US attack on Venezuela

The entry of larger volumes of Venezuelan oil into the market is expected to add to oversupply concerns and further depress oil prices, which have been falling in recent months.

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In morning trading in Asia, Brent Crude prices fell 0.21% to $60.62 per barrel, while West Texas Intermediate (WTI) lost 0.35% to $57.12, although still higher than its previous low.

US forces invaded Caracas in the early hours of Saturday, bombing military targets and taking Maduro and his wife away to face federal drug charges in New York.

US President Donald Trump stated that the United States will now “manage” Venezuela and send US companies to repair the country’s severely damaged oil infrastructure.

Oil prices pressured by oversupply

After years of underinvestment and sanctions, Venezuela is now only able to pump around one million barrels of oil per day, down from around 3.5 million barrels per day in 1999.

However, analysts assess that significantly increasing Venezuela’s oil production will not be easy and cannot be done in a short time, amid great uncertainties about the country’s future.

“Any recovery in production will require huge investments, given the infrastructure devastated by years of mismanagement and underinvestment,” UBS analyst Giovanni Staunovo told AFP.

In addition, investing at this time is also less attractive: oil prices are pressured by oversupply and are set to decline through 2025, despite major economic pressures such as Trump’s tariff wars and the continuing conflict in Ukraine.

Read also: Weekly Crypto Price Forecast: Bitcoin, Ethereum, and XRP Continue Steady Gains

Then, How is the Crypto Market Movement?

On the other hand, according to CoinMarketCap data, the crypto market showed positive movement with the global market capitalization reaching $3.15 trillion, up 1.1% in the last 24 hours. The CMC20 index, which represents the performance of the top 20 crypto assets, also saw an increase of 1.2% to $196.58, reflecting the positive sentiment among major assets in the market.

However, the Fear & Greed Index indicator stands at 42, reflecting a neutral sentiment from market participants – not overly optimistic, but also not showing extreme fear.

Meanwhile, the Altcoin Season score stands at 21 out of 100, indicating that the current dominance is still in the hands of Bitcoin (BTC), and has not yet entered the altcoin season phase, where altcoins usually outperform Bitcoin to a large extent.

Overall, although the market is showing positive daily growth, investor sentiment is still cautious, and altcoins have yet to take center stage.

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*Disclaimer

This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Crypto trading activities have high risk and volatility, always do your own research and use cold cash before investing. All activities of buying and selling bitcoin and other crypto asset investments are the responsibility of the reader.

Reference:

• CNA. Oil prices fall after US ousts Venezuela’s Maduro. Accessed on January 5, 2025