Oil gains on fresh sanctions blow to Venezuela

Brent crude futures have risen after US President Donald Trump declared a complete ban on sanctioned oil tankers carrying Venezuelan oil.

IMAGE: Oil storage tanks. Getty Images

The US President on Tuesday ordered a “complete and total” blockade of sanctioned oil tankers moving in and out of Venezuela.

The development comes amid heightened tension between the two oil-producing nations. “[Oil] prices are finding better support… with Venezuelan supply risks growing,” two analysts from ING Bank noted.

Last week, the US Coast Guard and the Department of Homeland Security intercepted a sanctioned oil tanker off Venezuela’s coast, marking the first seizure of a Venezuelan oil cargo since US sanctions were introduced in 2019.

Washington subsequently expanded its measures, with the US Treasury sanctioning six additional vessels accused of carrying Venezuelan crude while employing deceptive and unsafe shipping practices.

“Venezuela exported around 600k b/d [600,000 b/d] of oil in November. It’s likely that these volumes will fall given the latest developments,” the two analysts said.

Relations between the two countries deteriorated after Venezuela failed to uphold its commitment to conduct fair presidential elections last year, prompting continued pressure from US President Donald Trump for Nicolás Maduro to step down.

By Aparupa Mazumder

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