Report Industry Investment Rating - The report suggests a short - term volatile and weak oil price, with a medium - term bearish allocation [4] Core Viewpoints - With clearer statements from US officials, Venezuelan crude oil will be controlled by the US in the future. The path for Venezuelan oil to turn from sanctioned oil to compliant oil is becoming clearer. The main trading logic in the market is that US Gulf refineries will absorb Venezuelan oil, squeezing the demand for Canadian heavy oil. Venezuelan oil shipments to China will decline significantly. The overall supply of sensitive oil is abundant, and the net effect after the Maduro incident is a decrease in compliant oil demand and an increase in medium - to - long - term production growth expectations, which is bearish for oil prices in the short and medium term [3] Summary by Related Catalogs Market News and Important Data - On January 8, Trump said Venezuela would use funds from the new oil agreement to buy US - made products [1] - US Energy Secretary Chris Wright on the 7th declared the US would "indefinitely" control Venezuelan oil sales, aiming to stabilize and increase production. The sales revenue will be deposited in a US - controlled account for the benefit of Venezuelans. He estimated a potential increase of 700,000 barrels per day in the medium - to - short - term [1][2] - Mexican President Cinbaum on the 7th denied sending more oil to Cuba after Maduro's arrest and said Mexico would be an important oil supplier to Cuba [1] - US Attorney General Bundy on the 7th issued a seizure order for the "BELLA 1" oil tanker transporting sanctioned oil [1] - US Secretary of State Rubio outlined a three - stage process in Venezuela: stabilizing the situation, the recovery stage, and the transition stage [1] - White House Press Secretary Levitt said Trump was not afraid to seize sanctioned oil tankers, even if it might strain relations with Russia [1] - After Trump announced Venezuela would "transfer" up to 50 million barrels of oil to the US, Canadian crude oil prices in the US Gulf Coast tumbled. The discount of Canadian "Cold Lake" crude oil to WTI increased from $6.80 to $8.50 per barrel, and in Alberta, the discount of heavy crude oil widened from $13.90 to $14.10 per barrel [2] Investment Logic - The future control of Venezuelan oil by the US makes its path from sanctioned to compliant oil clearer. The market expects US Gulf refineries to absorb Venezuelan oil, squeezing Canadian heavy oil demand. Venezuelan oil shipments to China will drop, but overall sensitive oil supply is sufficient, leading to a decrease in compliant oil demand and an increase in medium - to - long - term production expectations, which is bearish for oil prices in the short and medium term [3] Strategy - The oil price is expected to be volatile and weak in the short term, and a bearish allocation is recommended in the medium term [4] Risk - Downside risks include the achievement of a peace negotiation between Russia and Ukraine and macro black - swan events - Upside risks include tightened supply of sanctioned oil (from Russia, Iran, and Venezuela) and large - scale supply disruptions due to Middle East conflicts [4]

Group 1 - The oil market experienced significant volatility, with WTI crude oil reaching a high of $57.73 and Brent crude oil hitting $61.24 before both prices fell below their opening levels, with WTI dropping to $56.31 and Brent to $59.75, reflecting a decline of over 1.6% [1] - By the end of the trading day, WTI crude oil was up 0.07% at $57.37, while Brent crude oil increased by 0.13% to $60.83 [1] Group 2 - Venezuela holds the world's largest proven oil reserves, estimated at over 300 billion barrels, accounting for nearly one-fifth of global oil resources, surpassing Saudi Arabia and being approximately 6.7 times that of the U.S. [3] - The United Nations Secretary-General expressed shock over the escalating situation in Venezuela, with an emergency meeting scheduled to discuss U.S. military actions [3] - The potential regime change in Venezuela is viewed as a significant geopolitical factor that could influence oil prices, although concerns about global supply excess remain a long-term pressure on prices [3] - The U.S. has long sought access to Venezuela's heavy crude oil, with plans for major U.S. oil companies to invest billions to repair the country's oil infrastructure [3][4] Group 3 - Venezuela's proven oil reserves are primarily located in the Orinoco Belt, the largest heavy oil reserve globally, which complements the U.S. market that mainly produces light crude oil [4] - Previous sanctions on Venezuela and Russia forced U.S. refineries to use more expensive alternatives, impacting profit margins [4] - If U.S. policies affect Venezuela's oil industry, refiners along the U.S. Gulf Coast could benefit, as Venezuelan heavy crude aligns with the processing capabilities of many local refineries [4]