Trump Administration Cracks Down on Venezuelan Oil
The Trump administration has indicated a sustained effort to counter Latin American drug cartels, after a US attack on a Venezuelan ship killed 11 on September 2. In the midst of these security issues, Venezuela’s oil sector has once more emerged as a geopolitical hot spot. The nation, with an estimated 303 billion barrels of proven reserves the world’s biggest continues to be a significant contributor, but its production and exports are only a fraction of what they once were. Comparatively, the United States has about 55 billion barrels, and Venezuela’s reserves are more than five times bigger.
Orinoco Belt: Huge Potential, Restricted Output
Venezuela’s oil deposits are found in the Orinoco Belt, covering 55,000 square kilometres in the east. The area has extra-heavy crude that needs sophisticated extraction methods like steam injection and mixing to be converted into saleable oil. PDVSA, the state-run oil company, dominates most of the operations but is beset by perennial problems, including outdated infrastructure, corruption, and American sanctions. While gasoline remains extremely cheap domestically at $0.04 per litre, Venezuela exported only $4.05 billion in crude oil in 2023 a stark contrast to major producers like Saudi Arabia ($181 billion) and the US ($125 billion).
Decline, Sanctions, and Limited Recovery
Venezuela’s oil exports have plummeted over the past two decades. After being a significant provider of goods to the US, shipments decreased following Hugo Chavez’s nationalization efforts and were further limited under Nicolas Maduro because of political upheaval and US sanctions since 2017. With restricted access to international markets, Venezuela turned to China and other countries, and exports to the US practically ended. Chevron was granted a temporary license by the US Treasury in November 2022 to reinstate limited production, a strategy continued under the Biden administration to stabilize global oil supplies while limiting revenue to Venezuela’s government.
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Following President Trump’s comeback in 2025, he announced a 25% tariff on Venezuelan oil-linked imports aimed at countries like China and India. Though India’s Reliance Industries suspended imports, China did not, proving the limited effectiveness of sanctions. Despite of these challenges, Venezuelan oil exports reached more than 900,000 barrels per day by September 3, 2025, the highest in nine months. Yet, production levels are still much below pre-sanction times, indicating continued political, economic, and geopolitical limitations.
