Oil Surges on Dual Geopolitical Shocks: US Strikes Iran Talks, Seizes Venezuela Assets

Global energy markets are pricing in a massive risk premium today as the US administration pivots toward an aggressive militaristic stance in both the Middle East and Latin America. WTI Crude Oil spiked +3.0% to $61.10 after President Trump cancelled diplomatic engagements with Iran and hinted at military options, prompting Tehran to declare its armed forces “combat-ready” and threaten US regional bases.

The “New Monroe Doctrine”

Compounding the supply fears is a major escalation in the Western Hemisphere. Under a rebooted national security strategy explicitly referencing the “Monroe Doctrine,” US forces have moved to secure control over Venezuelas oil infrastructure. The administration claims this move is to secure strategic resources, with Energy officials suggesting indefinite US control over Venezuelan exports.

Supply Chain Shockwaves

This coordinated assertion of US hegemony has drawn sharp condemnation from global powers, including Russia and a coalition of Latin American nations. For Forex traders, the immediate reaction is a classic “risk-off” flight:

• CAD: Despite higher oil prices, the geopolitical instability and regional friction may cap the Loonie's gains.
• JPY & CHF: Seeing inflows as safe-haven assets amidst fears of a broader conflict.
• USD: Gaining strength from its role as the primary reserve currency during crises.