Geopolitical factors are heavily influencing the price of oil once again since the US troops captured President Maduro and his wife in a daring raid last week.
Although Venezuela can sell its oil through the United States, its shadow fleet that used to transfer oil to international destinations is facing major hurdles as never before by the US Navy. It, however, may not lead to a disruption of the supply of the commodity in the markets, as the United States is playing a key role in the process.
In Iran, meanwhile, unprecedented protests have broken out across the country, yearning for the return of the Crown Prince, Reza Pahlavi. Iran, which has been cornered, both economically and politically, by heavy international sanctions, slid into a survival mode in the face of huge protests. If protestors from all walks of life get what they want, there is a strong possibility of Iranian oil reaching the markets as a normal player - eventually.
The evolving political situation in Venezuela and Iran has not pushed the oil prices as there is no danger of a supply disruption. On the contrary, if politics settle down in two major players in the oil sector, oil supply may be boosted much quicker than analysts thought a few months back.
As far as the Middle Eastern suppliers are concerned, the serious rift between the UAE and Saudi Arabia over Yemen may affect when it comes to making policy decision over the price of oil by the OPEC+. Although both sides appear to show that relations are as normal as they were before, it will take time for the former allies to repair the damage and move on as normal partners.
In light of rapidly developing global events, it is perfectly understandable why Saudi Arabia lowered the oil price for its Asian markets; it knows losing its market share is not an option it can afford to happen, when oil prices are on a downward spiral.
