11 January 2026 | 4:02PM EST Commodities Research OIL ANALYST 2026 Outlook: Prices Trend Down on Strong Supply; Geopolitical Risks Remain Daan Struyven +1(212)357-4172 | daan.struyven@gs.com Goldman Sachs & Co. LLC Yulia Zhestkova Grigsby +1(646)446-3905 | yulia.grigsby@gs.com Goldman Sachs & Co. LLC Alexandra Paulus +1(212)902-7111 | alexandra.paulus@gs.com Goldman Sachs & Co. LLC Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and ...

Summary of Key Points from the Conference Call Industry Overview - The focus is on the oil industry, particularly regarding Venezuelan oil and its implications for the US market amid geopolitical risks and domestic political challenges ahead of the US midterm elections in November 2026 [1][2][3]. Core Insights and Arguments - The US is attempting to redirect Venezuelan oil to alleviate rising oil prices, with an initial plan to move 30-50 million barrels (m bbls) of Venezuelan oil to the US [1][3]. - This redirection may lead to a diversion of Canadian heavy crude oil to Asia, as US Gulf Coast refiners will likely process the Venezuelan oil [1][3]. - Geopolitical risks, including tensions in Iran and the Russia-Ukraine situation, could keep oil prices supported in the range of $55-65 per barrel [1][2]. - US oil inventories are experiencing a rise in gasoline and diesel stocks, while crude stocks are declining due to strong refinery runs [1][4]. Supply and Demand Dynamics - Short-term measures could result in a growth of Venezuelan oil supply by 0.3-0.5 million barrels per day (m b/d) starting from the fourth quarter of 2026 [2]. - Long-term supply recovery in Venezuela may take over eight years to return to levels above 3 m b/d, contingent on political and economic stability [2]. - US commercial crude inventories fell by 3.8 m bbls to 419.1 m bbls, exceeding expectations for a 1.3 m bbl draw, driven by strong refinery runs [7]. - Refinery runs increased slightly to 16.9 m b/d, while gross crude imports and exports also saw significant increases [7]. Inventory and Utilization Trends - As of the end of 2025, US commercial crude inventories were up by 5 m bbls year-over-year, with crude output rising to 13.8 m b/d [4]. - Diesel stocks rose by 5.6 m bbls to 129.3 m bbls, surpassing expectations for a 1.6 m bbl build, while gasoline inventories increased by 7.7 m bbls to 242.0 m bbls [8][9]. - The US Strategic Petroleum Reserve (SPR) increased by 245,000 bbls to 413.5 m bbls [7]. Additional Important Insights - The US is facing political, security, legal, and fiscal uncertainties regarding Venezuelan oil, which could impact future supply and investment [2]. - The US administration's actions may have broader implications for oil flows to other countries, particularly China, which may need to source oil from alternative suppliers [3]. - The overall demand for oil products has shown a decline, with total product supplied decreasing by 0.15 million b/d week-over-week [13]. This summary encapsulates the critical points discussed in the conference call, highlighting the current state of the oil industry, particularly in relation to Venezuelan oil and its impact on the US market.

Summary of Conference Call Notes on US Oil & Gas Services and Exploration & Production Industry Overview - The focus is on the Oilfield Services (OFS) sector, particularly in relation to Venezuela's oil production potential and its impact on stock prices of major OFS companies [1][2]. Key Points and Arguments 1. **Market Reaction to Venezuela News**: - The stock prices of major OFS companies such as SLB, HAL, and WFRD increased significantly (approximately 9%, 8%, and 10% respectively) due to expectations of increased foreign investment in Venezuela's oilfields [2]. - The market capitalization increase of 8-10% on a single day appears disproportionate when considering the EBITDA contribution needed to justify it, estimated at over $6 billion for the Big 4 OFS companies [1][2]. 2. **Revenue Opportunity Assessment**: - A return to around 75 active rigs in Venezuela could represent a market opportunity of approximately $3-3.5 billion for OFS services, which is less than the market capitalization increase suggests [1][3]. - Historical data indicates that when Venezuela produced 2.5-3 million barrels per day, it operated 70-80 rigs, suggesting a potential $10 billion drilling and completion (D&C) market if similar activity levels are achieved [3]. 3. **Valuation and Yield Analysis**: - The stock movement has closed the valuation gap between large-cap OFS and E&P companies, particularly at a WTI price of $60 [4][9]. - The 2027 Free Cash Flow (FCF) yield for OFS companies has improved, reflecting a rebound in the Middle East, although it did not significantly drop below E&P yields [4][9]. 4. **Historical Context and Future Outlook**: - The Big 4 OFS companies previously wrote off billions in receivables from Venezuela, and restarting collection efforts may influence current stock movements [4]. - The overall sentiment suggests that while some of the stock price increases may be temporary, a portion of the gains could be sustained as the market recognizes the valuation gap [4]. Additional Important Information - The report includes a detailed analysis of stock movements and their implications for revenue opportunities, with a total implied revenue opportunity exceeding $6 billion for the global OFS sector [8]. - The report also highlights the competitive landscape, indicating that OFS companies may face competition in certain product lines, which could affect their revenue from D&C services [3]. Conclusion - The conference call emphasizes the potential for growth in the OFS sector driven by developments in Venezuela, while also cautioning that the current stock price increases may not fully reflect the underlying revenue opportunities. The analysis suggests a complex interplay between market sentiment, historical performance, and future expectations in the oil and gas services industry [1][4][8].

January 5, 2026 01:50 AM GMT Crude Oil | Global M Update Venezuela's Oil Sector in 10 Charts The charts below provide an overview of key stats related to Venezuela's oil production. Much remains uncertain for now. If there is short-term disruption, the global market is currently well placed to absorb this. Over the medium term, risks to Venezuela's production skew higher. Venezuela famously holds one of the largest oil reserves in the world. Definitions vary but focusing on crude oil only, the country indee ...

Summary of Key Points from the Conference Call Industry Overview - The focus of the conference call is on the oil industry, particularly regarding the geopolitical situation in Venezuela, Iran, and the ongoing Russia/Ukraine conflict, which are currently supportive for oil prices but may lead to bearish trends in the long term [1][2]. Core Insights and Arguments - **Venezuelan Oil Supply**: The US administration's "quarantine" on Venezuelan crude oil exports is expected to continue until satisfactory actions are taken by the Venezuelan government. Venezuelan oil exports were halved to approximately 500,000 barrels per day (b/d) in December 2025 due to a US naval blockade [2]. - **Future Projections**: The baseline scenario anticipates Venezuelan oil output to begin rising in the fourth quarter of 2026, with an increase of about 300,000 to 500,000 b/d from mid-2026 to the end of 2027. This increase is contingent on political stability and successful elections in Venezuela, which are expected by summer 2026 [2][5]. - **OPEC+ Response**: OPEC+, led by Saudi Arabia, is likely to cut output to maintain Brent crude prices between $55 and $60 per barrel if there is a significant rise in inventories due to increased Venezuelan production [2][5]. - **Investment Needs**: A substantial investment of $80 to $100 billion is required to restore Venezuelan oil output to approximately 2 million b/d over eight years. The Orinoco Belt contains the majority of Venezuela's proven reserves, estimated at over 300 billion barrels, which is nearly 20% of global reserves [10]. - **Technical Constraints**: Despite vast reserves, the lack of a stable investment climate and infrastructure means that large-scale production increases will take years rather than months. Historical production data shows a peak of around 3.7 million b/d in the 1970s, with current production just over 1 million b/d [7][10]. - **Short-term Gains**: Near-term production increases are expected to come from blending and diluent availability rather than political changes. Access to naphtha for blending could unlock up to 200,000 b/d of incremental output without significant new investments [8]. Additional Important Insights - **Governance and Stability**: The political situation in Venezuela remains uncertain, and any meaningful increase in oil supply will depend on governance reforms and the establishment of a stable government that can attract investments [6][12]. - **China's Oil Procurement**: If China does not receive its usual volumes of Venezuelan oil, it may seek alternative heavy crude oils from the open market, which could impact global oil prices [14]. - **Downstream Constraints**: Venezuela's refining capacity is currently operating at about 25% of its nameplate capacity, reinforcing the country's dependence on crude exports and imported refined products [11]. This summary encapsulates the key points discussed in the conference call, highlighting the complexities and uncertainties surrounding the Venezuelan oil market and its implications for global oil prices.

Morgan Stanley Research Global January 5, 2026 12:50 PM GMT January 5, 2026 Vishwanath Tirupattur – Chief Fixed Income Strategist | Strategist Devin McDermott – Head of North American Energy Research | Equity Analyst and Commodities Strategist Simon Waever – Global Head of EM Sovereign Credit and LatAm Fixed Income Strategy | Strategist Ariana Salvatore – Public Policy Strategist | Strategist MORGAN STANLEY & CO. LLC Martijn Rats – Global Commodities Strategist and Head of European Energy Research | Equity ...

4 January 2026 | 2:24PM EST Commodities Research Oil Comment: Price Risks From Venezuela: Ambiguous in Short-Run But Negative in Long-Run Daan Struyven +1(212)357-4172 | daan.struyven@gs.com Goldman Sachs & Co. LLC Yulia Zhestkova Grigsby +1(646)446-3905 | yulia.grigsby@gs.com Goldman Sachs & Co. LLC Alexandra Paulus +1(212)902-7111 | alexandra.paulus@gs.com Goldman Sachs & Co. LLC Price Risks From Venezuela: Ambiguous in Short-Run But Negative in Long-Run 1 PDVSA reportedly aimed to reduce Orinoco Belt pro ...

January 4, 2026 05:00 PM GMT The Oil Manual | Europe Outlook 2026: Letting the Curve Do the Work The expected surplus arrived in 2H25 and is likely to grow larger in 1H26. Rising inventories will require a steeper contango across the entire Brent curve, putting pressure on front-month prices. However, as the long-end is likely to stay resilient, spot prices should find support in the mid/upper-50s. Key Takeaways Exhibit 1: Including oil in transit, inventories built sharply in 2025, particularly in 2H. Thes ...

Weekly Performance S&P 500: 1.40% S&P 500 Energy: 1.11% XOP: -0.48% OIH: -1.36% ab 28 December 2025 Global Research North American Oil & Gas Weekend Exploration – Top 10 Predictions for 2026 WTI: 0.60% Henry Hub: 10.19% This week we provide our top predictions and ideas list for 2026 inside. We highlight 10 ideas across the sector, stocks, and commodities. Have a great rest of the weekend and Happy New Year! Josh Equities Americas Energy Josh Silverstein Analyst josh.silverstein@ubs.com +1-212-713 3513 Peyt ...

Summary of Key Points from the Conference Call Industry Overview - The conference call primarily discusses the oil markets, focusing on Venezuela and Russia, and the implications of U.S. sanctions on their oil exports [1][2][3]. Core Insights and Arguments - **Sanctions on Venezuela**: The recent drop in WTI oil prices to $55/bbl has prompted the Trump administration to consider enforcing sanctions on Venezuelan oil exports. The administration may monitor Venezuelan tankers or implement stricter sanctions, but the extent of enforcement remains uncertain [1][2][4]. - **Quantitative Impact of Sanctions**: The term "sanctioned" in Trump's statement limits the blockade's impact to approximately 0.4 million barrels per day (mbd) of Venezuela's heavy crude exports and 0.1 mbd of product exports, primarily fuel oil [1][5]. - **U.S. Military Presence**: An increased U.S. military presence in the Caribbean is noted, which may influence oil futures and suggests a potential political transition in Venezuela [1][7]. - **Russian Oil Exports**: Despite sanctions, Russian crude exports are estimated at around 3.5 mbd in December, only slightly below previous highs. Product exports have also recovered to approximately 2.1 mbd, supported by refinery throughput of 5.3–5.4 mbd [1][21]. - **Sanctions' Effect on Trading Structures**: Sanctions have altered trading structures rather than significantly reducing export volumes. Exports are being rerouted through new intermediaries, which increases transaction costs and clearance times [1][22][28]. - **Economic Pressure on Russia**: Russia's upstream sector is experiencing declining gross profits, dropping from about $57/bbl at the start of 2025 to below $30/bbl now. This trend may have more significant long-term implications than the sanctions themselves [1][34]. Additional Important Insights - **Potential for Venezuelan Production Recovery**: In a post-Maduro scenario, production could initially drop by up to 50% due to operational disruptions but may rebound to around 1.2 mbd within months if political stability is restored [1][11][16]. - **Investment Opportunities**: The return of former partners, including Chinese companies, could lead to increased production levels in Venezuela, contingent on political changes and new investments [1][15]. - **Long-term Outlook**: The oil supply and demand balance for 2025 and beyond indicates a potential increase in global oil supply, with Venezuela representing a significant upside risk if political conditions improve [1][37][38]. This summary encapsulates the critical points discussed in the conference call, highlighting the current state of the oil markets concerning Venezuela and Russia, the implications of U.S. sanctions, and potential future developments in the industry.