Venezuela has avoided U.S. oil export embargoes for years, selling crude oil mainly to China at discounted prices. But even this limited source of revenue is now under threat after the United States seized an oil tanker bound for Cuba.
Sanctioned President Nicolas Maduro denounced “piracy” and said Venezuela had lost 1.9 million barrels of oil in one fell swoop. Nearly 1.1 million barrels, according to ship tracking platform MarineTraffic.
The United States has said it intends to retain the seized oil, estimated to be worth between $50 million and $100 million.
Although the U.S. Navy has deployed strong forces in the Caribbean since September, Venezuela’s so-called “ghost” oil tankers have so far remained unaffected.
In a follow-up action on Thursday, the U.S. Treasury Department announced sanctions on six companies it said were transporting the South American country’s oil and designated six vessels as “blocked property.”
Such actions “will deter fleets operating on the black market from coming to Venezuela. It will increase the risk premium, so the discounts (to buyers) will be very large,” Francisco Monadi of the Baker Institute, a Houston-based think tank, told AFP.
Maduro claims the massive U.S. military deployment within striking distance of his country is part of a plan to overthrow him and “steal” Venezuela’s rich oil under the guise of an anti-drug operation.
Targeting ships transporting Venezuela’s only valuable commodity could indeed jeopardize Maduro’s political fortunes.
“If there are no oil exports, it will affect the foreign exchange market and the country’s imports… and could trigger an economic crisis,” Elias Ferrer of Venezuelan consultancy Orinoco Research told AFP.
“It’s not just the recession, there’s a shortage of food and medicine because we can’t import it.”
– black market –
Venezuela’s oil reserves are estimated at about 303 billion barrels, more than any other country, according to the Organization of the Petroleum Exporting Countries (OPEC).
But years of mismanagement and corruption have slashed production from a peak of more than 3 million barrels per day in the early 2000s to a record low of 350,000 barrels per day in 2020.
Analysts say output will be back on track to 1 million barrels per day this year, making it difficult to increase output to that level given the shortage of foreign currency needed to improve infrastructure.
Caracas has been struggling under a regime of economic sanctions and a US oil embargo since 2019, which were tightened in 2025.
It employs a fleet of “ghost” tankers that sail under false flags, declare false routes or turn off their transponders to avoid detection.
Since Trump threatened to impose 25% export tariffs on any country buying Venezuelan oil, the country has had to slash black market prices by as much as 20%.
In addition, Chevron, which has a special license to produce about 10% of Venezuela’s output, is no longer allowed to transfer funds to the state and is therefore required to pay crude oil taxes and other fees.
– Any help? –
It is estimated that China purchases 80% of Venezuelan products.
To avoid sanctions, customers pay in cryptocurrencies, including asset-pegged stablecoins, primarily USDT.
This has led to a dollar shortage in Venezuela’s partially dollarized economy and a wide gap between the official and black market exchange rates.
The surge in product prices has raised fears of a return to hyperinflation in a country still reeling from a 1 million percent price rise in 2018, the culmination of a four-year period of hyperinflation that led to millions of emigrations.
“Now we will see how far countries like China, Iran and Russia are willing to take risks in supporting Venezuela,” Ferrer said.
According to MarineTraffic, the “Captain” oil tanker seized by the US military this week will be sanctioned by the US Treasury Department in 2022 for suspected links to Iran’s Islamic Revolutionary Guard Corps and Hezbollah.
Iran is one of Venezuela’s main allies, along with Russia, whose President Vladimir Putin this week reiterated support for Maduro but is locked in a raging war in Ukraine.
Ferrer noted that Maduro had weathered years of U.S. sanctions and political pressure, even at a time when “oil production was 300,000 barrels and inflation was 1 million percent.”
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