US Grants Chevron License to Expand Venezuelan Oil Production

The recent easing of U.S. sanctions allowing Chevron to resume operations in Venezuela marks a strategic shift in American energy policy, balancing expanded oil production with ongoing political pressure on President Nicolás Maduro. Chevron's return is expected to boost Venezuelan oil output by around 250,000 barrels per day, a modest increase globally but significant for Chevron and U.S. Gulf Coast refiners who will benefit from discounted heavy crude, helping alleviate feedstock shortages. While this production increase is unlikely to disrupt global benchmarks like Brent crude prices, it may reduce the premium on heavy crude grades and diversify refinery inputs. Concurrently, Asian oil markets demonstrate resilience despite challenges from sanctions, tariffs, and geopolitical tensions, with OPEC+ continuing to raise supply, contributing to a projected surplus and downward pressure on oil prices. In contrast, Iran's influence in global oil markets is waning due to structural shifts such as new producers, diversified supply chains, and slowed demand growth, despite its continued discounted sales to China and sanctions evasion efforts. Overall, these developments underscore the complex interplay of geopolitics and oil markets, with supply growth and strategic recalibrations shaping near-term dynamics.