Jan 24, 2019

Oil markets shrug off Venezuela's chaos for now

Protestors hold a demonistration against Maduro in Bogota, Colombia, on Jan. 23. Photo: Juan Barreto/AFP/Getty Images

Oil prices are basically flat Thursday after falling yesterday despite uncertainty in Venezuela and the White House endorsement of regime change against Nicolás Maduro. But, that could change if new U.S. oil sanctions arrive soon.

Why it matters: For now, the limited market response to Venezuela shows how concerns about a weakening global economy are keeping upward price pressures from the geopolitical turmoil in check.

Where it stands: This morning, WTI crude was trading around $52.22 and Brent was at $60.57.

What they're saying: “Right now, the market is kind of keyed in to growth risks stemming from U.S.-China trade talks, and a slow start out of the gate for the U.S., given the government shutdown,” Macro Risk Advisors' Chris Kettenmann told the Wall Street Journal yesterday.

But, but, but: Prices inched up earlier this morning, and one analyst tells Reuters that the prospect of U.S sanctions against Venezuelan crude exports could jolt the markets soon.

  • "For now, it's not being fully priced in, but I think this does provide a new upside risk for the market," Petromatrix's Olivier Jakob said.

The intrigue: Venezuela's collapsing production in recent years has already lessened its prominence in global markets.

  • But it's still a very important player for U.S. refiners who use substantial volumes of Venezuelan heavy crude.
  • "Refiners in Texas and Louisiana would be hard hit by sanctions on Venezuelan crude under consideration at the White House, a move that would leave U.S. oil companies struggling to find alternative supplies," per Bloomberg.

Go deeper:

Go deeper

Mark Cuban opens door to 2020 run

Photo: Axios Events

Businessman and Dallas Mavericks owner Mark Cuban revived talk of an improbable 2020 presidential bid during an Axios virtual event on Friday.

  • "Everything's a reset right now," Cuban told Axios CEO Jim VandeHei from Dallas. "If this would would've been a month ago, I would have said absolutely not. But obviously things are crazy, things are changing. So I'll keep an open mind. But I seriously doubt it."

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 2 p.m. ET: 1,066,706 — Total deaths: 56,767 — Total recoveries: 223,697Map.
  2. U.S.: Total confirmed cases as of 2 p.m. ET: 258,214 — Total deaths: 6,605 — Total recoveries: 9,408Map.
  3. Business latest: Mark Cuban criticizes "arrogant" 3M on respirator production — The wartime mobilization effort to produce ventilators and medical supplies got started too late.
  4. Politics latest: Lawmakers on both sides of the aisle are worried about the difficulties of delivering the $2.2 trillion in stimulus aid.
  5. Jobs update: The U.S. lost 701,000 jobs in March, but the new report doesn't reflect the height of the virus' impact on the economy.
  6. World update: About half of the deaths worldwide are in Italy and Spain, with fatalities exponentially increasing across Europe.
  7. What should I do? Answers about the virus from Axios expertsWhat to know about social distancingQ&A: Minimizing your coronavirus risk.
  8. Other resources: CDC on how to avoid the virus, what to do if you get it.

Subscribe to Mike Allen's Axios AM to follow our coronavirus coverage each morning from your inbox.

Mark Cuban criticizes "arrogant" 3M on respirator production

Photo: Axios Events

Businessman and Dallas Mavericks owner Mark Cuban said during an Axios virtual event Friday that 3M is "arrogant" for not speaking up about respirator production in the midst of the coronavirus outbreak.

What he said: Cuban criticized the company for "making more globally than domestically," echoing a similar line from President Trump now that the U.S. is the epicenter of the pandemic. "You can't ghost the American people," he told Axios CEO Jim VandeHei from Dallas.