Oil prices steady with OPEC+, Venezuela in focus at beginning of 2026

Oil prices steadied on the first trading day of 2026 post its biggest annual drop since 2020, as traders gauged the upcoming OPEC+ meeting and geopolitical concerns.

West Texas Intermediate was above $57 a barrel, posting declines heading into the New Year break, while global benchmark Brent ended below $61.

Key OPEC+ members led by Saudi Arabia and Russia are set to hold a video conference on January 4, and are expected to stick with a decision — first made in November — to halt further supply hikes.

On the geopolitical front, the President Donald Trump’s administration stepped up a campaign against Venezuela’s oil exports by sanctioning companies in Hong Kong and mainland China, along with vessels accused of evading curbs. Meanwhile, Russia and Ukraine struck each other’s Black Sea ports over the new year period, damaging infrastructure including a refinery.

Crude retreated by about a fifth last year on mounting concerns about a worldwide glut following an earlier round of supply hikes from OPEC+, as well as rising output from the rival drillers. The International Energy Agency has forecast a glut of about 3.8 million barrels a day for this year.

“Geopolitical events will support crude prices in the short term,” said Robert Rennie, head of commodity and carbon research at Westpac Banking Corp. Still, lower prices are expected over the course of the first quarter on oversupply concerns and potential progress toward a peace deal in Ukraine, he said.

Related to the standoff in the Venezuela, Russia has made a formal diplomatic request that the US stop its pursuit of a tanker that had been sailing for the South American nation to pick up oil, but is now fleeing from the Coast Guard in a chase across the Atlantic Ocean, the New York Times reported. The ship, known as the Bella 1, had started its journey in Iran.

With inputs from Bloomberg