The wave of supply generated by the U.S. oil boom will help cushion any possible disruption from Venezuela if political unrest in Latin America’s largest crude oil exporter escalates, energy strategists told CNBC this week.
The effect of current outages in Libya and South Sudan, combined with the perceived threat to supply from Venezuela, is keeping global markets on edge and prices well-supported. But an improved global supply buffer implies any build-up of the risk premium will be limited, they said.
Venezuela is a key supplier of crude oil to growth markets in Asia, and holds the world’s largest oil reserves, but cargoes destined for the U.S. have dwindled. The current spate of political turmoil in the Organization of Petroleum Exporting Counties (OPEC) producer hasn’t yet affected supply as anti-government protesters have so far refrained from disrupting operations at oil fields and terminals.
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