Fuel experts say it’s too early to tell what effect the ouster of Venezuela’s Nicolás Maduro will have on gas prices, especially in California where motorists pay the highest amount per gallon in the continental U.S.
“It doesn’t have a short-term impact,” said David Hackett, president of Stillwater Associates, a transportation energy consulting company in Irvine. “I think longer term though,” a revival of Venezuela’s oil production may lead to “additional world supply and probably would result in lower volatility and energy prices.”
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Maduro and his wife were captured in a raid Saturday in a joint military operation, taken into custody and flown to the U.S. where they face narco-terrorism conspiracy and cocaine importation conspiracy charges.
Arraigned in a Manhattan federal courthouse Monday, the couple submitted not guilty pleas.
In addition to the drug charges, the Trump administration says the toppling of Maduro can pave the way for U.S companies to re-enter the oil-rich Venezuelan market.
“We’re going to have our very large United States oil companies — the biggest anywhere in the world — go in, spend billions of dollars, fix the badly broken infrastructure, the oil infrastructure, and start making money for the country,” Trump told reporters.
But Trump’s remarks drew rebukes from some, including Sen. Chris Van Hollen, D-Maryland.
“This has never been about stopping drugs from coming to the US — it’s about grabbing Venezuela’s oil for his billionaire buddies,” Van Hollen said on X. “Trump has put American troops in harm’s way to boost oil company profits. Outrageous.”
Venezuela used to be an oil production powerhouse. The South American nation holds more proven reserves of crude oil than any other country in the world, even surpassing Saudi Arabia, according to OPEC, the Organization of the Petroleum Exporting Countries.
But under Maduro and his predecessor, Hugo Chávez, the oil sector is now a shell of what it once was. As late as 2001, Venezuela produced more than 3 million barrels of petroleum products per day. By 2024, that figure had fallen to 903,000 barrels a day, according to data from the U.S. Energy Information Administration.
It’s been estimated that 8 million Venezuelans have left the country since 2014.
“They’ve got a lot of talented people who understand” the oil business, Hackett said. “I know Venezuelan engineers who would go back in a heartbeat to help their country.”
But in the aftermath of the U.S. raid, plenty of questions remain.
“To hear the president talking about taking over the oil sector there and it’s going to reduce oil prices, a lot of this is going to be years in the making, and it’s going to require almost everything to go perfectly,” said Patrick De Haan, head of petroleum analysis at GasBuddy.
Chevron is the only major U.S. oil company left in Venezuela, producing about 250,000 barrels a day through a joint agreement with the state-owned Petróleos de Venezuela S.A., commonly known as PDVSA.
“Chevron remains focused on the safety and well-being of our employees, as well as the integrity of our assets,” a company spokesman said in a statement following Maduro’s apprehension. “We continue to operate in full compliance with all relevant laws and regulations.”
Exxon Mobil and ConocoPhillips pulled out of Venezuela in 2007 after Chávez seized oil assets when he nationalized the country’s energy sector. The two companies have billions of dollars in outstanding claims against the government in Caracas.
“There’s going to have to be a tremendous amount of rebuilding of infrastructure that’s fallen into disrepair,” De Haan said, pointing out that power blackouts occur almost daily across Venezuela.
“The root of the infrastructure that would support rising oil output needs to be addressed before pipelines get rebuilt, before oil can flow through those pipelines,” De Haan said. “A lot needs to happen … And even then, U.S. oil companies are not going to be chomping at the bit to potentially have their assets reseized again.”
So far, the news out of Venezuela has not moved oil markets much.
On Monday, the first day of trading after Maduro’s capture, the futures price of Brent crude (the international benchmark) rose 1.8% to about $62 per barrel. West Texas Intermediate, the U.S. domestic benchmark price, also ticked up 1.8% to just over $58 a barrel.
The average price for gasoline in the U.S. on Monday did not change from the day before, standing at $2.81 per gallon, according to AAA. The price in California remained unchanged, too, averaging $4.27 on Monday.
Only Hawaii, at $4.41 a gallon, has a higher average price than the Golden State.
“There’s plenty of oil out there,” Hackett said. “The Energy Information Administration puts together a short-term energy outlook, and they’re still pretty bearish on oil prices, at least in the first quarter, maybe in the first half” of this year.
The Associated Press contributed to this story.
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