US vs Venezuela: How Oil, Power And Sanctions Are Pushing Them Towards A Dangerous Standoff

Last Updated:December 17, 2025, 14:56 IST

Since September, the US military has significantly increased its presence in the Caribbean, deploying warships, marines and helicopters

Venezuela has argued that the US is using drugs and democracy as pretexts for regime change. (AP Photo)

Across the Caribbean Sea, a confrontation has been quietly hardening into something far more dangerous. Warships, marines and surveillance aircraft have been moving into waters off a South American coast, while seizures of vessels, sweeping sanctions and political ultimatums have pushed relations between the United States and Venezuela to their lowest point in decades. For many outside the region, the question is that why has this country, little known to the wider world, become the focus of such intense American pressure?

The nation at the centre of the standoff lies north of Brazil and east of Colombia, its coastline opening into the Caribbean. Roughly 3,200 kilometres south of the US, Venezuela can be reached by sailing south from Florida across open sea. Though comparable in land area to Gujarat and Rajasthan combined, it has a population of under 30 million. By most measures, it is not a global heavyweight. Yet it holds the largest proven oil reserves on Earth, even more than those of the Middle East.

That single fact has shaped its modern history and its troubled relationship with the United States.

After gaining independence from Spain in the 19th century, the country’s fortunes changed dramatically in the early 20th century with the discovery of oil. By the 1920s, American energy companies had moved in, and crude exports to the United States surged. For decades, the relationship was mutually profitable. Until the 1990s, around 15% of America’s oil imports came from this source, and diplomatic ties remained largely cordial.

The turning point came in 1999, when Hugo Chavez, a fiery socialist and former army officer, was elected as the Venezuelan president. Chavez accused foreign corporations, particularly American ones, of draining national wealth while ordinary citizens remained poor. He moved swiftly to nationalise the oil industry, sharply cutting the stakes of US companies and redirecting revenues towards state control. His rhetoric grew increasingly hostile to Washington, framing the struggle as one of sovereignty against imperial influence.

Tensions escalated in 2002 with an attempted coup against Chavez, which briefly removed him from power before loyalists restored him. Though direct evidence remained contested, many in Venezuela believed the US had backed the plot, reinforcing deep mistrust. When global oil prices soared between 2003 and 2008, Chavez expelled most American companies entirely and used the windfall to fund ambitious social programmes, including free education and healthcare for the poor.

Yet the economic model rested almost entirely on oil. Allegations of corruption multiplied, production efficiency declined, and other sectors withered. When Chavez died in 2013, his successor Nicolas Maduro inherited both power and a fragile system. The collapse came swiftly.

In 2014, oil prices crashed from nearly $100 a barrel to around $30. State revenues evaporated. Inflation spiralled, food and medicines disappeared from shelves, and daily life became a struggle for survival. Over the next few years, more than seven million people fled the country, triggering one of the largest refugee crises in modern Latin American history.

Washington responded with sanctions. Beginning in 2014-15, the United States accused the Maduro government of human rights abuses and democratic backsliding, imposing trade and financial restrictions similar to those used against Iran. Under Donald Trump’s first term as the US President, these measures intensified.

In 2017, US refiners were barred from buying the country’s oil, and allies were pressed to follow suit. Two years later, the US recognised opposition leader Juan Guaido as interim president, declaring Maduro’s re-election illegitimate.

Later, the Biden administration sought dialogue, easing some restrictions in exchange for promises of electoral reforms. But those efforts collapsed amid allegations of fraud in the 2024 elections and the jailing of opposition figures. Sanctions were reimposed and expanded.

Now, with the Trump administration back in US, the pressure has turned overtly muscular. Since September, the US military has significantly increased its presence in the Caribbean, deploying warships, marines and helicopters. US forces say they have intercepted or attacked 21 vessels linked to drug trafficking, many allegedly connected to Venezuelan networks.

On November 29, the US announced the effective closure of Venezuelan airspace, preventing commercial flights from operating there, a move Venezuela described as an act of war.

In recent weeks, US forces seized a Venezuelan oil tanker accused of violating sanctions and imposed fresh penalties on six ships, several companies and relatives of Maduro’s wife. Trump reportedly issued a one-week ultimatum demanding that Maduro leave power and go into exile with his family.

The White House insists its actions are about security, not conquest. US officials label the country a “narco-terrorist state", alleging that cocaine produced in neighbouring Colombia passes through its territory en route to Europe and North America, with protection from senior figures in the military and government. The US accuses Maduro of dismantling democracy, rigging elections and presiding over widespread human rights abuses that have destabilised the entire region and driven migrants northwards.

Venezuela rejects these claims, arguing that the US is using drugs and democracy as pretexts for regime change. Venezuelan leaders say the true objective is control over oil. Sanctions, they note, have slashed oil production from around three million barrels a day to roughly 7,00,000, crippling the economy. The Council on Foreign Relations in the US has openly stated that sanctions are intended to pressure Maduro to step down, a position that reinforces suspicions in Venezuela.

The risk now is escalation. Some US lawmakers have warned that the strategy could drag the US into another prolonged conflict, while advisers in Brazil have cautioned that a military intervention could become a “new Vietnam" in Latin America. Analysts also point to the wider geopolitical stakes; any involvement by Russia, particularly through advanced weapons or missile deployments, could rapidly internationalise the crisis.

A satellite image circulating in December, reportedly showing the large oil tanker Skipper near Port Jose before its seizure, has become a symbol of the tightening noose. Whether the confrontation remains limited to sanctions and maritime enforcement or slides into open conflict remains uncertain.

News world US vs Venezuela: How Oil, Power And Sanctions Are Pushing Them Towards A Dangerous Standoff

Read More