What's happening in Venezuela won't immediately affect prices at the pump in the United States, according to Patrick De Haan, Dallas-based GasBuddy's head of petroleum analysis.
De Haan, who is also vice president of media relations, communications and consumer programs for Alpharetta, Georgia-based PDI, spoke Wednesday during a PDI webinar on what fuel marketers and the convenience-store industry should be watching in light of the United State's Jan. 3 capture of Venezuelan President Nicolás Maduro and his wife.
U.S. officials said they will manage the sale and proceeds of specific Venezuelan oil shipments being redirected to the United States, with revenues held in U.S.-controlled accounts to help steer political and economic outcomes, according to Reuter's.
Such moves could shift oil prices over time, though misconceptions persist that these changes will immediately affect prices at the pump, De Haan said.
Venezuela had the world’s largest proven crude oil reserves in 2023 (about 303 billion barrels), representing around 17% of global reserves, according to the U.S. Energy Information Administration (EIA).
“The number that a lot of Americans are probably hearing is that Venezuela is sitting on top of potentially 300 billion barrels of crude oil,” said De Haan. “Now, not all of that may be recoverable, but this is sizable and could have major impacts for oil markets moving forward.”
However, the U.S. has imposed sanctions on Venezuela and its oil sector due to concerns over the government’s human rights abuses, corruption and undermining of democratic institutions, according to the U.S. Department of State.
Maduro's capture escalates uncertainty
The situation shifted on Jan. 3 when U.S. forces captured Maduro and his wife during a military operation, escalating political uncertainty, according to Reuters.
While U.S. officials announced on Wednesday that Venezuela will begin supplying crude to the United States immediately with an initial shipment of about 30 million to 50 million barrels and that sales could “continue indefinitely,” according to Reuters, this reflects oil already in storage or ready for export, not a sudden jump in daily production, said De Haan. Venezuela’s oil infrastructure has been weakened by years of underinvestment, sanctions and operational decline.
“Keep in mind, even as recent as 2024 and back in 2019, this is a country that still has challenges with basic electricity,” De Haan said. “So before we talk about potentially adding oil supplies to the global market, there are immediate needs of rebuilding this infrastructure.”
S&P Global Energy CERA Analyst Jim Burkhard said production capacity is constrained by years of underinvestment and deteriorated infrastructure and that boosting output to much higher levels would require “much greater spending … and take many years.”
“Some of the biggest questions I'm asking are, ‘Will the regime shift? Will it open the doors for democracy? Will Venezuela's leaders, whether or not they're pro Maduro or new leaders, align with the U.S.? Will there be cooperation? Will there be broad sanctions relief?’” De Haan said.
All of that is going to have to happen for a lot of these objectives to be met, De Haan said. For Venezuela's oil output to increase, it's going to take a sizable amount, probably measured in the tens of billions of dollars, to rebuild Venezuela's infrastructure.
If Venezuelan oil reaches Gulf Coast refineries, it could increase local supply and slightly lower fuel prices in the Southeast, Mid-Atlantic and Gulf Coast regions, De Haan said. Midwest and interior U.S. markets may feel less immediate impact.
How pump prices could be affected
Some may assume that Venezuelan oil suddenly means gas prices will plummet across the U.S., but the reality is more nuanced, De Haan said. For convenience-store operators and fuel marketers, the evolving situation is worth monitoring because changes in Venezuelan crude availability or U.S. import policy could influence crude costs and refining economics, which ultimately affect pump prices, he said.
Right now, in early January, seasonal trends—not Venezuelan supply—are driving relatively low gas prices, which will likely continue for the next four to six weeks, De Haan said. But as demand for gasoline rises heading into warmer weather and events like March Madness, prices will begin their normal seasonal climb. As De Haan said, after the sweetness of Valentine’s Day passes, Americans typically feel the “bitterness” of higher gas prices—a pattern likely to hold this year.
Executives in downstream and refining sectors should recognize that, over time, Venezuelan crude could serve as a stabilizing force in the oil market, helping reduce price volatility and mitigate shocks like those seen during crises such as Russia’s war in Ukraine, De Haan said. While current production is limited, the potential for increased supply, especially of heavy crude suited for U.S. Gulf Coast refineries, matters for gasoline pricing and refining economics. Leaders should focus on the long-term picture, even amid ongoing uncertainty.
For c-store retailers, these market dynamics intersect with consumer behavior, De Haan said. Foot traffic may face pressure this year, as many shoppers remain cautious due to inflation, high borrowing costs and overall economic uncertainty. While returning to the office is boosting commute traffic and visits to stores along the way, operators may need to lean more heavily on promotions and deals to convert visits into purchases. Offering attractive deals could help capture attention from consumers who are still price-sensitive and looking for value, he said.
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