Update: A Different Oil Market Starts This Week
Venezuela sits on the largest global proven oil reserves. Long-term consequences may reprice energy equities faster than investors expect, starting with Chevron.
Updated Trade Plan As Of 5 January 2026 (Before Market Open)
What happened (and why Monday still matters for investors)
Over the weekend, the U.S. carried out a large-scale military action in Venezuela, resulting in the capture of President Nicolás Maduro and a sudden regime transition. On the surface, this is the kind of event that usually sends oil prices sharply higher.
Yet going into Monday, the setup is far more nuanced.
Analysts speaking to CNBC were quick to downplay the near-term oil price impact, noting that Venezuela produces roughly 800,000 barrels per day, less than 1% of global supply, and exports only about half of that. In an oil market that remains well supplied and seasonally soft, expectations are for only a modest move in crude prices, potentially $1–$2 at most.
But markets don’t move only on barrels. They move on structure, expectations, and second-order effects. And while oil futures may stay calm, energy equities are heading into a very different environment this week. For investors, this matters because oil markets reprice before supply visibly changes. When expected barrels become less certain, risk premia adjust, volatility rises, and capital moves.
The ripple effects are unlikely to stay contained to headlines or futures curves. They are far more likely to surface in energy stocks, spreads between sub-sectors, and relative performance across the complex.
Why oil prices may stay contained
The consensus emerging from analysts is clear: this is unlikely to be a short-term oil shock.
Global supply remains ample after OPEC+ ramped production in 2025
U.S. output sits at record levels above 13.8 million barrels per day
Demand is seasonally weak heading into Q1
Venezuelan exports were already constrained
Plus, the market has already priced in Venezuelan risk, leaving little room for a panic-driven spike in crude.
But this is exactly where equity markets diverge from commodities. Oil prices reflect current balances. Stocks reflect future pathways.
And over the weekend, the future pathways for Venezuela (and for companies exposed to heavy crude, refining, and long-term benefits) changed meaningfully.
The market is now pricing the future
Multiple analysts highlighted that a post-Maduro Venezuela, if sanctions were lifted and foreign capital allowed back in, could eventually raise production toward 2–3 million barrels per day over the medium to long term. That would make Venezuela one of the most consequential growth stories in global oil supply.
That outcome is neither immediate nor guaranteed. Rebuilding Venezuela’s energy sector would take years of political stabilization, billions in investment, and clear legal and fiscal frameworks
But equity markets don’t wait for certainty.
Venezuela is known to be the country with the highest proven oil reserves in the world. The long-term implications are massive.
Stocks most exposed
Main Player: Chevron CVX 0.00%↑
Chevron is the most obvious equity lever, and gives growth potential without earnings risk. Chevron already operates in Venezuela under U.S. licenses and has spent years maintaining a foothold in the country.
From an investment perspective:
Venezuela does not materially move Chevron’s near-term earnings
But it provides embedded upside potential if sanctions ease
Chevron is positioned to act faster than peers if investment doors open
That asymmetry matters. Markets tend to reward companies that already sit inside potential upside scenarios, even if realization is distant.
Why we updated the CVX trade plan
Chevron’s setup changed materially overnight.
Pre-market action pushed the stock sharply higher, creating a gap and moving price into a new range. When that happens, old levels and assumptions stop being useful. Rather than forcing the previous plan to fit, it’s better to reset and work with what the market is actually doing now.
This update focuses on the post-gap structure and the most important levels for the days ahead.
Updated Technical Snapshot:
Event-driven gap: CVX 0.00%↑ has gapped hard into the high-160s , after tagging roughly 171.7 pre-market. That’s a regime shift: price discovery is happening now.
Post-gap behavior: After the initial spike, price is holding a tight range around 167-168. That’s constructive. The best gaps consolidate, they don’t immediately bleed.
Momentum is extreme (short-term): The 4H RSI is very overbought (~90+). That doesn’t mean sell. It means don’t chase, but expect volatility + pullbacks.
Key gap support zone: The charts show a very clean moving-average ladder underneath price:
~167.1 (fast MA area)
163.6 (next MA shelf)
160.2
157.2
These become the decision levels if the gap starts to fill.
Pullback roadmap:
162.1 (0.382) = first serious buy-the-dip zone if it starts retracing
159.1 (0.50) = deeper fill, still constructive
156.1 (0.618) = “last clean support” before the move starts losing its post-gap edge
Upside roadmap:
171.0–171.7 = first retest zone (prior spike high)
173.3 then 177.1 = next extensions if the gap holds and oil tape stays supportive
179-209 if momentum and trends continue
Previous Technical Snapshot:
Trend: Price is above the rising short-term EMAs and reclaiming prior range structure.
Momentum: MACD is positive and accelerating on short-term, but very stretched (RSI > 80). That usually means upside is possible, but chasing is higher risk.
Near-term resistance: The current push is running into a measured extension zone around 155.9 to 156.7.
Best support cluster (buy-the-dip zone): The first meaningful pullback area:
154.12 - 153.57 - 153.02
Nearby MA support around 154.39 and 153.43
Updated Trade Plan
Plan A: Growth Continuation - hold
