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<Research>CLSA: Venezuela's Situation Raises Geopolitical Risks, Supports Gold Prices, Intensifies Oil Oversupply
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Venezuela holds the world's largest proven reserves (17.5%) but accounts for only 1% of global production, CLSA released a research report saying. If capital expenditure is sufficient, output is expected to surge by 3x, continuing the oversupply of oil, which would lower oil prices and benefit import countries with current account deficits in the Asia-Pacific region (such as India and the Philippines). Although, militarily, US President Donald Trump's actions have been successful so far, this recent adventurism may trigger more regional ambitions, raising geopolitical risks and supporting gold prices. If the situation develops, investments by large US oil companies may exacerbate the oversupply of oil, the broker added. Venezuela's state-owned oil company, PDVSA, has been severely sanctioned since 2019, leading to significant damage in oil and gas extraction. AASTOCKS Financial News Website: www.aastocks.com |
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