Jim Cramer, the host of CNBC’s Mad Money, is again questioning the validity of oil stocks in the current geopolitical climate.
In a January 9 post on X, the former hedge fund manager asked his followers to explain why investors flocked to oil stocks, given that President Donald Trump is trying to bring down the price of the commodity itself, just as he did in 2016.
Cramer was most certainly alluding to the strong oil rally resulting from Venezuelan President Maduro’s Capture, as well as Trump’s reported plans to leverage the South American country’s oil reserves to push U.S. crude prices down toward $50 a barrel, as first reported by the Wall Street Journal on January 7.
Jim Cramer still critical of oil stocks
Today’s social media post was not the first time Cramer warned investors about oil-related investments. On Tuesday, January 6, he noted that a more selective approach is preferable after the market’s recent rally.
The CNBC host specifically flagged late-cycle enthusiasm around oil stocks, noting that buyers who jumped in near recent highs could be exposed if Venezuelan production increases and puts downward pressure on crude prices.
Venezuela holds the world’s largest proven crude reserves, though much of its production capacity has deteriorated after years of underinvestment, mismanagement, and sanctions. If the nation were to raise its output to its previous peak near 3 million bpd, total U.S.-aligned production could approach 14 million bpd, roughly one-third of the combined output of the Opec+ alliance.
Trump’s aforementioned plan comes amid a prolonged downturn in global oil markets. Specifically, crude prices fell nearly 20% in 2025, marking the most drastic annual decline since the COVID-19 pandemic. In addition, the strategy reportedly includes curbing Russian and Chinese access to Venezuelan oil, positioning the United States as a cornerstone of a western hemisphere energy bloc.
However, Cramer’s skepticism could also reflect some lingering worry about how quickly Venezuela’s oil industry can be revived. Trump has said U.S. oil companies would return to invest billions in restoring infrastructure, but firms such as Chevron (NYSE: CVX), currently the only U.S. oil company operating inside Venezuela, will hardly commit without firm guarantees from Washington.
Featured image via Shutterstock
Source: https://finbold.com/why-buy-oil-stocks-when-trump-wants-to-bring-oil-prices-down-jim-cramer-asks/
