National Security

Venezuelan Economy in Shambles as U.S. Cuts off Oil Exports

Mural of Nicolás Maduro in Petare slum in Caracas, Venezuela / Getty Images

The United States has tightened restrictions on the Venezuelan oil trade, increasing economic pressure on the communist regime, according to a Monday Reuters report.

Thanks to new sanctions on Venezuelan oil shipments, the country’s exports have plummeted to their lowest level in 80 years. Oil comprises about 99 percent of Venezuela’s export earnings. Newly fortified laws taking aim at licensing and registration for commercial vessels will make it difficult for shipping companies to justify doing business with the communist state.

"What you will see is most shipowners and insurance and captains are simply going to turn away from Venezuela," said U.S. special envoy to Venezuela Elliott Abrams. "It’s just not worth the hassle or the risk for them."

Facing an escalating campaign of American sanctions, the Maduro regime must manage a country in which 65 percent of households live in poverty. Most Venezuelans make less than 73 cents a day—a dire economic situation exacerbated by the COVID-19 crisis.

Washington has refused to recognize the authoritarian governing coalition. Instead, the White House looks to Juan Guaidó—who was constitutionally declared president by the country's National Assembly—to replace Nicolás Maduro as leader of the ailing country. "Maduro is an illegitimate ruler, a tyrant who brutalizes his people. But Maduro's grip of tyranny will be smashed and broken," President Donald Trump said in February.

Trump reaffirmed his support for a democratic regime earlier this month in remarks honoring Venezuelan Independence Day. "The Venezuelan people are suffering under an illegitimate and tyrannical regime intent on destroying democratic institutions, abusing human rights, engaging in rampant corruption, and exploiting the worst economic and humanitarian crisis in recent history," the statement reads. "My Administration will always stand against socialism."