A US military attack on Venezuela would cause an immediate shock to global markets, with oil at the epicenter. Venezuela produces approximately 800,000 barrels per day and accounts for nearly 10% of US crude oil imports. Any disruption—damage to refineries or ports, or new sanctions—would reduce global supply by 1-2%, enough to send prices soaring.
Analysts estimate an initial increase of 10-20% in Brent and WTI crude, similar to the 2011 surge following the Libyan conflict. A prolonged conflict could push the price of oil above $80-90 per barrel, benefiting Saudi Arabia and Russia, but impacting Europe, Asia, and US consumers (gasoline would rise by 20-30 cents per gallon).
Stock markets would react with a significant risk-off. The S&P 500 and the Nasdaq would fall 2-5% in the first few sessions, while the MSCI Emerging Markets LatAm index could decline 8-12%. Sectors such as airlines, transportation, and manufacturing would suffer from rising energy costs; in contrast, oil and defense companies would see initial gains.
The dollar would strengthen by 1-3% as a safe-haven asset, putting pressure on emerging market currencies. The Brazilian real, the Mexican peso, and the Colombian peso would depreciate by 3-7%, triggering a massive capital outflow. Venezuelan sovereign bonds (currently in default) have risen by 5-8% in recent weeks due to speculative bets on a regime change that would unlock the world's largest proven oil reserves (303 billion barrels).
In Latin America, the contagion would be rapid: a drop in Caribbean tourism, disruption of maritime routes, and a higher country risk premium. Historical lessons (Panama 1989, Iraq 2003, Libya 2011) indicate that initial shocks are mitigated if the operation is brief, but a prolonged war—with possible Russian or Chinese intervention in support of Maduro—would replicate the prolonged volatility seen in Ukraine in 2022.
In short, the market would reward gold, Treasury bonds, and energy/defense stocks, while punishing emerging markets, airlines, and consumer discretionary. Geopolitical uncertainty would be the dominant factor.
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