As 2026 begins against a turbulent and fast-changing geopolitical backdrop, the only real certainty for oil markets is uncertainty. Nowhere is this more evident than in crude prices, which have come under renewed pressure amid shifting supply dynamics and fragile global demand.
Oil prices fell this week after a U.S. operation to oust Venezuelan President Nicolás Maduro injected fresh uncertainty over the future of the world’s largest proven crude reserves. The market reaction was swift, with prices slipping toward three-week lows as traders reassessed supply risks.
Adding to the pressure, an unexpected deal announced by U.S. President Donald Trump has heightened concerns about a potential oil glut. On Tuesday, Trump revealed that the United States will import between 30 and 50 million barrels of crude from Venezuela’s previously sanctioned reserves. The move effectively increases global supply at a time when demand growth remains subdued.
The timing of the announcement has amplified bearish sentiment. Economic slowdowns across many of the world’s major economies continue to weigh on oil consumption, limiting the market’s ability to absorb additional barrels without price adjustments.
However, not all data points suggest a market awash with crude. Figures released by the American Petroleum Institute (API) on Tuesday showed that U.S. oil inventories declined by 2.8 million barrels in the final week of December, defying expectations for a sharp 12 million-barrel increase. While supportive in isolation, the data failed to offset broader supply concerns.
Meanwhile, OPEC+—which includes many of the world’s largest oil producers—met over the weekend and agreed to keep output levels unchanged. The decision followed a brief meeting that reportedly skirted growing tensions among member states. Despite the cartel’s efforts to project stability, the announcement provided little meaningful support to prices, underscoring how sensitive the market currently is to demand-side risks.
Taken together, these developments highlight the fragile balance facing oil markets at the start of the year. Geopolitical shocks, shifting alliances, and policy decisions continue to inject volatility, yet weak demand and rising supply fears are capping any sustained upside.
As 2026 unfolds, oil prices are likely to remain highly reactive to both political headlines and macroeconomic signals. For now, the market appears caught between persistent geopolitical risk and the growing reality of oversupply—leaving traders and producers navigating a landscape where uncertainty remains the dominant force.
Fuel cards prices will fall in the region of 1 penny per litre for next week.
Happy New Year!
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