Oil market prices show just how much supply is out there, says Sankey Research's Paul Sankey

Asking about Venezuela/Cuba situation impact on oil prices

Brian

Paul Sankey

Market perceives Venezuela regime change as potentially bearish for oil - immediate reaction would be negative due to potential for more supply

Reality of barrels coming back to market will take much longer, but immediate reaction would be negative

Oil price only up 2% despite Venezuela news, still at $58 - biggest message about oil inventories and market psychology

Brian

Paul Sankey

Disappointing oil price despite geopolitical risks (Israel/Iran, Russia/Ukraine) shows how much supply is out there

We've thrown everything at the oil price - geopolitical tensions haven't supported prices due to abundant supply

European oil majors (BP, Shell, Total) up 18% this year despite being written off - what's driving this and outlook for 2026

Brian

Paul Sankey

Market beginning to think about next phase of oil market post-oversupply, buying into oils as contrarian trade

European stocks have rallied significantly, market starting to position for post-oversupply phase

Metals flying while oil lacks bid despite strong economy and reduced energy transition urgency - why oil glut persists

Economy not in recession, demand for everything, energy transition less aggressive - yet oil remains weak

Brian

Paul Sankey

Oil supply side is abundant while metals have supply issues with massive demand - technology enables continued high productivity in oil

US production up with lower rig count shows strong productivity, natural gas at $4 shows energy abundance

Can high productivity remain - argument against owning oil stocks

Brian

Paul Sankey

$6B question is when US supply will roll over - global issues with Russia production, Venezuela refining capacity

Venezuela has world's biggest single refinery (doesn't run), Cuba angle adds complexity to Venezuela situation

Paul Sankey

State Department indicated Venezuela action is about lowering oil prices - pretty bearish

Off-the-record sourcing suggests policy aimed at reducing oil prices