US President Donald Trump has reportedly ordered a total blockade on all sanctioned oil tankers entering and leaving Venezuela.
The announcement follows the recent US seizure of an oil tanker off Venezuela’s coast, potentially impacting the country’s oil-dependent economy.
This intensifies Washington’s move to increase pressure on the Venezuelan Government, targeting its main source of income, reported Reuters.
Trump, on Truth Social, wrote: “For the theft of our Assets, and many other reasons, including Terrorism, Drug Smuggling, and Human Trafficking, the Venezuelan Regime has been designated a Foreign Terrorist Organisation.
“Therefore, today, I am ordering a total and complete blockade of all sanctioned oil tankers going into, and out of, Venezuela.”
The US is said to have increased its military presence in the region, deploying thousands of troops and a dozen warships, including an aircraft carrier.
In addition, US forces have conducted strikes on vessels in the Pacific Ocean and Caribbean Sea near Venezuela, resulting in at least 90 fatalities.
Reuters reported that China remains the largest purchaser of Venezuelan crude oil, accounting for around 4% of its imports.
The global oil market currently has sufficient supply, with millions of barrels waiting on tankers off China’s coast.
However, if the blockade continues, the reduction of nearly one million barrels per day from the market could influence oil prices, the report said.
The US has previously labelled Nicolas Maduro’s administration a foreign terrorist organisation, citing allegations of drug smuggling and human trafficking.
In response, Maduro claimed the US military build-up is intended to remove him from power and gain control of Venezuela’s oil reserves, which are considered the largest in the world.
In June this year, Venezuela’s state-run oil company, Petroleos de Venezuela (PDVSA), signed at least nine new agreements with foreign service providers, including two Chinese companies.
These agreements aim to maintain oil production and sustain foreign currency inflows following the exit of Chevron due to US sanctions.
They allow foreign companies to operate existing wells and sell the output, diverging from PDVSA’s traditional exclusive trading rights.
