Venezuela holds the world’s largest proven reserves. Under Maduro and sanctions, production collapsed from roughly three million barrels per day to under 800,000. The removal of Maduro and the installation of an American-aligned successor government opens the possibility of Venezuelan production rehabilitation at scale—a massive supply injection, sold at steep discounts to rebuild market shares, into a market already suffering from fears of oversupply and price volatility. Iran presents the same logic at an even greater magnitude. If the Islamic Republic falls amid the current protest wave and a successor regime normalizes with the West, Iranian production could return to four million barrels per day or more without sanctions constraints. Taken together, the normalization of both Venezuelan and Iranian output would structurally undermine OPEC+ leverage and place sustained downward pressure on prices, precisely when Saudi Arabia needs elevated revenues to fund its ambitious projects, which are already struggling, and defend its regional position in a time of intensified competition.
Saudi Arabia simply wants Iranian oil out of Western markets. A pariah Iran under sanctions is a gift to Saudi market share and pricing power. The current developments pose a long-term threat to oil rents, which makes Saudi Arabia's regional strategy possible in the first place. The Saudi pivot is also a hedge against an American-led reordering of global energy markets that Riyadh cannot predict or control.
Corolarium: If Trump liberates Venezuelan and Iranian oil, Saudia will suffer. Russia will suffer. American producers will suffer. Oil is very cheap these days. Cherchez la femme!
