The Breakdown Venezuela Shockwaves and the New Geopolitics of Markets
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Jan 6, 2026 The capture of Venezuela's president has sent shockwaves through global markets. Despite the country’s vast oil reserves, the market reaction has been surprisingly subdued. Analysts reveal that these reserves may be overstated and burdensome to refine. Interestingly, the true target may be China, as the U.S. seeks to regain leverage. Gold and silver have surged, while Bitcoin remains stable. The evolving geopolitical landscape may reshape risk pricing and influence how the U.S. engages with Latin America moving forward.
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U.S. Overtly Claims Control Of Venezuela
- The U.S. captured Nicolás Maduro and claims it will run Venezuela until a transition is ensured.
- The operation signals a more overt, transactional U.S. approach to statecraft under Trump.
Huge Reserves, Tiny Current Output
- Venezuela holds headline reserves of ~303 billion barrels but currently produces only ~860,000 bpd.
- Markets barely moved because current production is small and obstacles remain to ramping output.
Reserves May Be Largely Illusory
- The oft-cited 300 billion barrel figure is likely inflated and many barrels are heavy, costly-to-refine crude.
- Economically recoverable reserves may be closer to ~25 billion barrels requiring huge investment.