The US seizure of an oil tanker off the coast of Venezuela marks a new escalation of tensions between the two countries and makes the weakened Venezuelan energy sector another powerful weapon that Washington could use in the fight against the regime of President Nicolas Maduro, writes the American business publication “Barrens“.
US President Donald Trump has declared that his Venezuelan counterpart's days in power “are numbered“ amid a military campaign launched by the US against drug trafficking in the region. But the government in Washington has never said that it wants to get its hands on Venezuela's vast oil reserves – which are the largest in the world – despite accusations to the contrary by Maduro and his entourage.
Now that the White House is ramping up the pressure, more tanker seizures are expected, which could allow the Trump administration to strike a direct blow to Venezuela's finances.
“I personally expect more (ship seizures) because it limits the regime's ability to make money and support itself, but also, more importantly, to pay the military to keep it happy and loyal,“ said Christopher Hernandez-Roy, director of the Americas Program at the Center for Strategic and International Studies, a Washington think tank.
The U.S. government's tactics could indeed lead to a reduction in oil volumes on world markets. Shipping companies that ship oil from those locations may worry that Washington will seize their tankers as well, Barrons said.
On Wednesday, the price of a barrel of U.S. light crude rose by $0.21, or a third of a percent, immediately after news of the vessel’s seizure.
If the seizures become more systematic, “it will significantly affect the willingness to send tankers to Venezuela and, in turn, force them to sell at a huge discount,” said Francisco Monaldi, director of the Latin American Energy Research Program at Rice University in Houston, Texas.
That could hurt Venezuela’s economy, which is already heavily dependent on discounted oil sales. Energy “makes up more than 90 percent of Venezuela’s exports and hard currency earnings and more than 50 percent of the country’s overall revenue,” Monaldi said.
At its peak, Venezuela produced more than three million barrels a day, but it is now capable of only about a third of that capacity. Its socialist governments over the past two decades have underfunded the sector and allowed the energy infrastructure to deteriorate and fall into disrepair, Barrens said.
On average, only about 750,000 barrels a day have been produced this year, according to energy consultant Kpler, a London-based company.
The drop in Venezuelan oil volumes, however, will not have much of an impact on global markets. The industry expects a surplus of between 1 million and 3 million barrels per day next year.
“This is not something colossal. The market is used to it“, said John Kilduff, a partner at the investment fund “Again Capital“. “Rather, if it (Venezuela) ever opens up to the world again, then there will be an effect that will contribute to lowering prices.“
China is the largest buyer of Venezuelan crude oil. According to Kpler, the detained vessel is “Skipper“ (Skipper), a supertanker loaded with more than 1 million barrels of crude oil.
According to US Attorney General Pamela Bondi, writing in Exx, the ship has been sanctioned for years for “participating in networks for the illegal transfer of oil that support foreign terrorist organizations“.
On Wednesday, Trump said that Washington would likely detain the ship's oil cargo. What steps the US intends to take further with respect to Venezuela, however, remains a mystery for now, “Barrens“ notes.
The Caribbean region has seen a large buildup of US military power. At the same time, the actions of the government in Washington are increasingly under scrutiny by Congress because of attacks on vessels, mostly small boats, off the coast of Venezuela, which the Pentagon claims are transporting drugs. Trump has not ruled out a ground invasion, and recently warned that Venezuelan airspace should be considered closed.
DEMOCRATS ACCUSE TRUMP OF AIMING FOR REGIME CHANGE IN VENEZUELA
Senator Chris Van Hollen, a Maryland Democrat and ranking member of the Senate Foreign Relations Committee, said the U.S. seizure of the oil tanker casts doubt on Washington's stated reasons for the buildup of military forces and attacks on vessels in the area, the Associated Press reported.
“It shows that this whole story they're using as a cover - that it's about fighting drugs - is a big lie,” the senator said. “It's just more evidence that this is really about regime change - by force.“
Vincent O'Hara, a naval historian and author of The Greatest Naval War Ever Fought, called the seizure “very unusual and provocative”. Noting that the move would likely cause other ships to avoid Venezuela, he said: "If you have no international shipping or access to it, you can't have an economy." The seizure came a day after U.S. military aircraft flew two fighter jets over the Gulf of Venezuela, perhaps the closest U.S. warplanes have ever flown into the South American country's airspace, the Associated Press reported. Trump said he would soon be striking drug cartel targets on the ground in Venezuela, but gave no further details. The U.S. government has accused Maduro of patronizing international drug trafficking, a charge he denies. Other Tanker Wars in History is a type of undeclared war in which one country attacks another's tankers to disrupt its economy and oil revenues.
It dates back to the 1980s, when the US Navy began escorting Kuwaiti tankers flying other countries' flags in the Persian Gulf and the Strait of Hormuz after a series of incidents in which ships passing through the area were damaged after colliding with Iranian mines, the Associated Press notes. Tensions escalated into a day-long naval battle between Washington and Tehran, and the US mistakenly shot down an Iranian passenger plane with 290 people on board, killing all but one.
According to US estimates, Iran attacked over 160 ships during this confrontation, which took place in the late 1980s.
In 2019, there was another series of attacks on tankers in the Middle East, for which Iran was again blamed - a conflict that was also declared a “tanker war“.
In a show of solidarity with the Palestinians after the outbreak of the Gaza war in 2023, the Shiite Houthi rebels in Yemen also attacked international shipping, including tankers sailing in the Gulf of Aden.