A major advisor to energy producing nations has suggested that the continued fallout from Venezuela could present a challenge for global oil markets. The International Energy Agency (IEA) has warned that crude supplies from Venezuela are at risk of falling sharply in the midst of an electricity crisis which has paralyzed the country recently.
Other OPEC and non-OPEC nations have stepped in to plug the gap in Venezuela's shipments, of a similar quality crude, indicating that potential supply chaos would likely be averted but that supply was tightening.
However, during the past week, industry operations were seriously disrupted and ongoing losses on a significant scale could present a challenge to the market, said the IEA.
Venezuela's oil production has taken a serious hit in recent years falling from approximately 2.4 million barrels a day (bpd) in 2015 to around 1.2 million bpd, as of the latest figures in February.
Both Brent Crude and WTI are trading up around 0.2% at US$ 67.35 and US$ 58.72 respectively London. Energy prices fell off a cliff in late 2014 but have started to rebound on the back of agreed cuts by OPEC in Vienna last year.
Venezuela's economy has been in a tailspin in recent years with inflation reaching insane levels while the country's president, Nicolas Maduro has faced rival claims from opposition leader Juan Guaidó. State-owned oil producer PDVSA's bonds rose sharply in January after some of the world's biggest economies backed the leadership challenge.