President Donald Trump has recently ordered a total blockade of oil tankers that are heading to or leaving Venezuela. He has also labeled the country as a “foreign terrorist organization’.” He also demanded the return of oil, land, and other assets that the country had stolen from the US.

Trump posted the following on Truth Social.

The current President in Venezuela is Nicolas Maduro. His predecessor Hugo Chavez had nationalized oilfields. Several International oil companies including ExxonMobil had large stakes in some oilfields in Venezuela.

Venezuela has the largest known oil reserves in the world and can produce roughly 1000,000 barrels a day. However, the country is facing US sanctions and has been cut off from global markets. It has to sell oil through private deals with deep discounts.

President Trump has been increasing sanctions and strikes on Venezuela, as well as some parts of the Caribbean Sea. There have been several strikes on alleged Venezuelan drug boats in the Caribbean Sea. 

The US Navy has also deployed military assets in the region. They include 11 navy ships as well as several amphibious assault ships, and an aircraft carrier, according to several reports.

A week earlier, the United States Navy seized a sanctioned oil tanker that was sailing off the coast of Venezuela. The US government has already sanctioned over 30 Venezuelan oil tankers.

President Donald Trump had sanctioned the Venezuela in government in his first term, as well. He said that the country was responsible for bringing huge amount of drugs as well as immigrants into the US. 

CWEB analysts say that the blockade of Venezuelan oil by the Trump administration will not lead to a major spike in prices. However, it can affect the countries that buy oil from Venezuela, despite sanctions.