In the wake of recent US military action in Venezuela, experts are pointing to oil as the primary driver of the conflict, even suggesting that the pursuit of resources outweighs concerns about democracy in the region. While the immediate impact on India appears limited, the situation is poised to escalate global tensions.
The US military strikes against Venezuela and the capture of President Nicolas Maduro have sent ripples through global commodity markets. Former Minister of State for External Affairs of India, MJ Akbar, emphasized Venezuela's vast oil reserves, which are the largest proven reserves globally, exceeding even those of Saudi Arabia. This has fueled speculation that the US is seeking to install a more amenable regime to exploit these resources. Foreign affairs expert Robinder Nath Sachdev highlights a history of US interventionism in oil-rich nations to support this claim.
Despite these geopolitical tensions, experts like Former Indian Ambassador to Venezuela R. Viswanathan, suggest that India's direct exposure to the Venezuelan economy is minimal, insulating it from major shocks. Sandeep Pandey, Co-founder of Basav Capital, also believes that the Indian stock market is expected to remain largely stable. However, rising crude oil prices could create short-term pressure on oil marketing companies and energy-intensive sectors.
The military action has raised concerns about key shipping routes and regional trade flows. Anuj Gupta, Director at Ya Wealth, anticipates a gap-up opening for commodities like gold, silver, copper, and crude oil. Gupta also predicts that silver prices may rise sharply, potentially reaching $75-$78 per ounce, while Brent crude oil could climb towards the $62-$65 per barrel range as traders factor in geopolitical risk. In India, MCX gold prices could approach ₹1,40,000 per 10 grams, with silver potentially rising to ₹2,45,000 per kilogram. Crude oil prices on the MCX are also expected to trade higher, potentially testing ₹5,200-₹5,300 per barrel.
The situation has already impacted precious metals, with gold prices surging to record levels as investors seek safe-haven assets. Gold hit a historic peak of $4,550 per troy ounce. Silver has also surged, reaching $83.75. Experts suggest precious metals will remain supported, potentially targeting $5,000 per ounce for gold by late 2026.
The US had previously surged warships to the Caribbean to intercept drug cartels and monitor oil tankers, which effectively created a naval blockade restricting Venezuelan exports. This blockade, along with the recent strikes, has exacerbated concerns about crude oil supply, with analysts warning that Brent crude could face upward pressure if infrastructure is threatened.
While the long-term impact remains uncertain, the conflict has undoubtedly introduced fresh volatility into global markets. Market participants caution that while headline risk may initially dent bullish sentiment, broader market direction will continue to be driven by domestic factors, macroeconomic data, and global cues from major central banks.
