The Trump administration certainly began 2026 in dramatic fashion, announcing the capture of the Venezuelan leader and his wife. As well as raising questions about what other moves the White House might make, it poses thoughts about the impact on the global energy sector and economy.

US military forces’ capture on Saturday of Venezuelan President Nicolas Maduro is a geopolitical shock that appears to have limited near-term impact on the global oil market, although it could presage weaker crude prices further ahead, wealth managers say.

Investors may find more opportunities in areas such as defence if countries, concerned about the path of US foreign policy, decide to ramp up spending on this area.

Banks and wealth managers yesterday were confronted by what to make of President Donald Trump authorising a military capture of Maduro, and Trump’s subsequent statement that the US will “run” the Latin American country – without elaborating. Delcy Rodriguez, who was Maduro’s vice president, has been sworn in as interim president and has already indicated that she opposes US plans for “regime change.”

“The removal of President Nicolás Maduro marks a significant geopolitical moment, but from a market perspective, its impact is expected to be limited. Venezuela represents just 0.1 per cent of global GDP and contributes around 1 per cent of the world’s oil supply – a stark contrast to the 1970s when those figures were 1 per cent and 8 per cent, respectively. This long-term decline is largely attributable to poor governance,” John Wyn-Evans, head of market analysis at Rathbones, a UK wealth manager, said in a note today.

“While Venezuela claims 17 per cent of proven global oil reserves, unlocking that potential would require vast investment in infrastructure. Moreover, its crude is 'heavy,’ yielding lower refining margins than Brent or WTI [West Texas Intermediate], making any immediate surge in supply – and the associated deflationary impulse – highly unlikely.

“Markets have taken the news in stride. Equities opened firmer, and bond markets remain largely unmoved. The US’s actions are expected to have a far greater impact on the geopolitical front, continuing the trend of unconventional and disruptive behaviour that has characterised the second Trump presidency,” Wyn-Evans said.

Stephen Dover, chief strategist and head of the Franklin Templeton Institute, said that while a shock, the US action was not unprecedented.

“The US has a long history of intervening in the Western Hemisphere. The US first formally declared its ‘hegemonic interests’ in the region via the Monroe Doctrine of 1823. It would therefore be incorrect, in our view, to consider the recent action as a fundamental change in US foreign policy, or to suggest that similar steps might be contemplated in the Middle East or elsewhere,” Dover said.

Muted markets
Yesterday, around 15:30 London time, the S&P 500 stock index was up 0.78 per cent, the UK FTSE 100 Index of blue-chip equities was up 0.16 per cent; the Euro Stoxx 50 was up 0.9 per cent and gold prices were a touch weaker from the open in London. West Texas Intermediate was up more than 1 per cent from the US market open, at $58.06 per barrel.

"Markets have so far shrugged their shoulders at the weekend’s Venezuela news, though questions linger over the longer-term geopolitical precedent it may set,” Chris Beauchamp, chief market analyst at IG, an online trading platform, said in a note yesterday. “Oil prices weakened initially, but losses have since been pared back given that any increase in production remains months away at the earliest. Equity markets continue to focus more squarely on this week’s payrolls report and the imminent start of [the] earnings season, though investors can be forgiven for wondering whether the US move increases the risk of geopolitical instability around Taiwan.

“Of potentially greater relevance is whether Washington continues to press its claims over Greenland, and how this may further strain cohesion within the Western alliance,” Beauchamp added.

Defence booster, dollar negative
Franklin Templeton’s Dover said the Venezuelan action makes defence investment more important.

“The Trump Administration has reinforced the perception that the US is willing to act unilaterally and to use force. Other countries, with territorial interests elsewhere, could be emboldened by the US use of power. This action will also likely add to the uncertainty of the dollar’s role as the `safe heaven’ while raising further questions about deterioration of international institutional pillars.

“The US military’s recent action is therefore likely to reinforce the trend, well underway, for various countries worldwide to invest more in their national security. That has been one of our key investment themes since the Russian invasion of Ukraine.

“Given the uncertainties about how Venezuela will be governed and given the checkered US history of ‘regime change’ in petro-countries (e.g. Iraq or Libya), oil markets are unlikely to anticipate a rapid increase in crude oil supply from Venezuela. Venezuela has the world’s largest reserves of crude oil (over 300 billion barrels), but the poor state of its ageing oil extraction and transportation infrastructure, coupled with the low quality of its ‘heavy’ crude, suggest that even the arrival of political stability will not quickly increase its crude oil output or exports (presently around 1 million barrels per day or roughly 1 per cent of world output). Another factor to keep in mind is that most of Venezuela’s oil is exported to China,” Dover continued.

At Julius Baer, the Swiss private bank struck a broadly sanguine tone.

“The US government has been very open about its motives, alluding to the country’s underused oil wealth and blaming the Maduro regime for drug trafficking. Venezuela’s oil industry has been in decline since the previous decade due to overexploitation, underinvestment, mismanagement, and US sanctions. Oil exports have fallen to 0.5 million barrels per day, accounting for less than 0.5 per cent of global supplies,” Norbert Rücker, head of economics and next generation research, said in a note. “The attacks appear to have been very focused on the arrest of Maduro. Key oil infrastructure remains fully operational. We believe that these events pose minimal near-term supply risks and thus offer minimal chances of a meaningful oil price bounce.

“Effective regime change requires more than targeted military attacks from a distance. Instead, the coming months and possibly years could be rather chaotic, with unstable oil supplies, if Libya and Iraq serve as precedents. Recent events do not alter the big picture. We maintain our neutral view and see oil prices trading in the high $50s for much of 2026. The oil market seems in a lasting surplus, largely due to structural factors, and able to weather geopolitics quite well,” Rucker said.

Dover said the medium to long-term impact on oil could be more significant.

“Longer-term stability in Venezuela, coupled with a potential peace deal in Ukraine, could release more than five million barrels per day of oil onto global crude markets by the end of this decade. If so, that would amount to about 5 per cent or more of global crude output, enough to keep oil prices depressed for longer, which would be a clear positive for global growth and a restraint on inflation,” he said.

Editor's note: The developments of the weekend are a striking reminder – as our US correspondent noted here – that wealthy investors must increasingly factor geopolitical risks into their considerations. The fracturing of traditional international norms, trade tensions and other developments represent a very different world to the seeming calm of 25 years ago. Political volatility appears to be the norm, not the exception. During the past quarter century, wealth managers' understanding of political risk has had to expand. This affects asset allocation and asset location – areas that this news service will look at this month in particular, and for the rest of the year. Please contact the editors if you want to comment: tom.burroughes@wealthbriefing.com and amanda.cheesley@clearviewpublishing.com.