Join our community of traders FOR FREE!

  • Learn
  • Improve yourself
  • Get Rewards
Learn More

Key Moments

  • Chevron shares advanced 7.3% in premarket trading as investors reacted to U.S. policy signals on Venezuela.
  • U.S. refiners Phillips 66, Marathon Petroleum, Valero Energy and PBF Energy gained between 5% and 16% in early moves.
  • Analysts warned that any substantial rebound in Venezuelan oil production would likely take time despite rising optimism.

Pre-market Rally in U.S. Oil Majors and Refiners

Jan 5 (Reuters) – Shares of U.S. energy companies climbed in premarket trading on Monday after investors interpreted President Donald Trump’s latest comments on Venezuela as a sign that American firms could secure expanded access to the country’s vast oil reserves.

Chevron, the only U.S. major currently operating in Venezuelan oil fields, saw its stock rise 7.3%. Refining companies Phillips 66, Marathon Petroleum, Valero Energy and PBF Energy all traded higher, with gains ranging from 5% to 16%.

CompanySegmentPremarket share move
ChevronIntegrated oil major+7.3%
Phillips 66RefinerBetween 5% and 16% (refiner group range)
Marathon PetroleumRefinerBetween 5% and 16% (refiner group range)
Valero EnergyRefinerBetween 5% and 16% (refiner group range)
PBF EnergyRefinerBetween 5% and 16% (refiner group range)

Trump Comments Fuel Expectations of Policy Shift

The share price reaction followed remarks from Trump that heightened expectations of a potential easing of U.S. restrictions on Venezuelan crude exports after the arrest of President Nicolas Maduro.

Trump said the United States needed “total access” to Venezuela’s extensive oil reserves, a statement that market participants viewed as signaling possible changes to existing constraints on American involvement in the country’s energy sector.

Trump added on Saturday: “We’re going to have our very large U.S. oil companies, the biggest anywhere in the world, go in, spend billions of dollars, fix the badly broken infrastructure, oil infrastructure, and start making money for the country.”

Venezuelan Output Slide and Crude Characteristics

Venezuela was producing as much as 3.5 million barrels per day (bpd) in the 1970s, representing more than 7% of global output at that time.

Output later fell below 2 million bpd in the 2010s and averaged about 1.1 million bpd last year, or roughly 1% of global supply, following years of limited investment and sanctions.

Venezuelan crude is described as a heavy sour oil with elevated sulfur content. It is well suited for the production of diesel and heavier fuels, though typically at thinner margins than other crude varieties, especially some grades from the Middle East.

“This type of crude aligns well with the configuration of U.S. Gulf Coast refineries which were historically designed to process such grades,” said Ahmad Assiri, research strategist at Pepperstone.

Chevron and U.S. Refiners Seen as Early Winners

Chevron’s ongoing operations in Venezuela under a U.S. waiver have given the company a head start relative to peers, positioning it as a potential primary beneficiary if U.S. policy were to loosen.

Refiners stand to benefit from increased access to heavy crude supplies sourced closer to the U.S. Gulf Coast, which could improve feedstock availability for facilities optimized for such oil.

Analysts Warn of Slow Recovery Path

Despite the rally in energy shares and growing expectations around policy changes, analysts emphasized that any significant rebound in Venezuelan oil production would not be immediate.

They highlighted political uncertainty, deteriorated infrastructure and a prolonged period of underinvestment as key obstacles that could slow any substantial recovery in the country’s output, even if access for U.S. companies improves.

TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover Forex, Price Action and Social Trading.

Related News

  • GBP/USD close to session highs following UK data, gains cappedGBP/USD close to session highs following UK data, gains capped British pound gradually advanced against the US dollar on Friday, but gains seemed capped, following the weak Public Sector Net Borrowing data, released from the United Kingdom today.GBP/USD cross reached a session high at 1.5257 at 9:01 […]
  • Forex Market: GBP/USD daily trading outlookForex Market: GBP/USD daily trading outlook Yesterday’s trade saw GBP/USD within the range of 1.4276-1.4518. The pair closed at 1.4303, losing 0.91% on a daily basis. It has been the 20th drop in the past 32 trading days, a second consecutive one and also the steepest one since January […]
  • Spot Gold holds near 3-week high on softer dollar, bond yieldsSpot Gold holds near 3-week high on softer dollar, bond yields Spot Gold edged higher on Thursday, while holding not far from recent three-week high, as the yellow metal drew support from US Dollar softness and a drop in US bond yields."The anticipation of this effective pivot towards interest […]
  • Commodities trading outlook: gold, silver and copper futuresCommodities trading outlook: gold, silver and copper futures Gold and silver prices were lower during midday trade in Europe today. The ECB kept rates unchanged, while ECB President Draghi said the bank had no plans to act dramatically in the immediate future. Meanwhile, copper futures were higher ahead […]
  • Forex Market: GBP/USD daily trading outlookForex Market: GBP/USD daily trading outlook Yesterday’s trade saw GBP/USD within the range of 1.4198-1.4346. The pair closed at 1.4261, edging up 0.20% on a daily basis. It has been the 33rd gain in the past 72 trading days and also a third consecutive one. The daily high has been the […]
  • Gold trading outlook: futures trade near 2-month lows ahead of the US data stringGold trading outlook: futures trade near 2-month lows ahead of the US data string On Monday (in GMT terms) gold for delivery in December traded within the range of $1,317.2-$1,328.5. Futures closed at $1,327.1, inching up 0.09% compared to Friday’s close. It has been the 155th gain in the past 326 trading days and also a […]