As countries around the world introduce sanctions on Russia and oil majors pull out of Russian operations, there will be an inevitable dip in the world's oil supply. The question is how this supply shortage can be met in the short term as worldwide demand remains high.

Venezuela recently appealed to Wall Street for support as it attempts to convince U.S. President Biden to lift sanctions. Having produced just over 3 million bpd of crude in 2013, Venezuela has the potential to provide the world with plenty more oil than it currently is. This fact has clearly not been lost on the Biden administration, with reports over the weekend of meetings between U.S.and Venezuelan officials in Caracas regarding bringing more crude to market.

Earlier this year, political officials from Venezuela attempted to charm Wall Street players with the promise of restructuring around $60 billion in bond debt held by Fidelity, T. Rowe Price, and BlackRock, as well as non-US funds. They also offered infrastructure concessions, oil and gas reserves, and asset privatizations in return for the restructuring of a debt that began defaulting in 2017. This would help U.S. bondholders to recover some of the money owed from Venezuela that had previously appeared lost. 

Venezuelan President Maduro stated in a televised announcement in early February, "If all sanctions were lifted – monetary, financial and banking sanctions against Venezuela – Venezuela would respond to bondholders the next day." Going on to say, "We are ready. We have a very solid proposal."

The price of oil has increased substantially over the last year, as demand grew following the pandemic. With oil prices breaking $130 on Sunday over fears that the U.S. and its European allies would ban Russian crude. If Biden wants to prevent U.S. fuel prices from soaring and to suppress inflation ahead of the midterms, then finding more supply is going to be a key priority.