- U.S. intervention in Venezuela over the past week lifted oil stocks, notably Chevron (CVX).
- Chevron is the only U.S. major still operating in Venezuela and could raise output without large new capital spending.
- Analyst Jason Gabelman at TD Cowen estimates an added $400 million–$700 million a year in cash flow for Chevron, about 1%–2% of its operating cash flow.
- President Donald Trump announced a deal for Venezuela to “turn over” oil to the U.S., described as a potential $3 billion arrangement sold at market prices.
- Some analysts and commentators, including Mizuho, Citigroup, and Cramer, disagree on outlooks and targets for Chevron.
U.S. actions in Venezuela over the past week boosted American oil stocks after authorities detained President Nicholas Maduro and brought him in for a criminal trial, a move that has raised the prospect of U.S. control over Venezuelan oil supplies, according to statements from President Donald Trump. The situation drove gains in shares such as Chevron (CVX) and other U.S. oil producers in recent days.
Analysts flagged a near-term benefit for Chevron, which remains the only U.S. major still operating in Venezuela. TD Cowen analyst Jason Gabelman said the company has a “differentiated opportunity among peers to increase production,” noting potential additional cash flow of “between $400 million and $700 million a year, representing about 1% to 2% of the company’s cash flow from operations.”
The Trump administration also moved forward with an oil arrangement described as a $3 billion deal, saying Venezuela would “turn over” 30 to 50 barrels of oil to the United States to be sold at market prices, a development that surprised energy markets and pushed oil stocks higher.
Gabelman wrote that Chevron would likely raise output from existing assets rather than deploy major new capital until Venezuela has a stable government and fiscal regime. He added, “We suspect Chevron will be hesitant to invest material incremental capital in Venezuela until there is a stable government and fiscal regime.”
Market watchers differ on longer-term prospects. Mizuho shows a high price-target score and a $206 target, while Citigroup posts a $179 target and strong historical accuracy scores. Television commentator Cramer voiced skepticism about buying Chevron, citing risks from oil-price dependence.
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