Venezuela Braces for Economic Collapse From U.S. Blockade

Venezuela could lose the bulk of its export revenues this year if the U.S. blockade stays in place, according to internal government estimates, a scenario that would set off a humanitarian crisis.Employees outside Venezuela’s state oil company, known as PDVSA, in Caracas in October.Credit...Adriana Loureiro Fernandez for The New York TimesJan. 6, 2026, 12:01 a.m. ETEven before American forces blasted their way into Venezuela’s capital and seized President Nicolás Maduro on Saturday, the nation was already facing dire economic prospects.The partial blockade imposed by the United States on Venezuela’s energy exports was expected to shutter more than 70 percent of the country’s oil production this year and wipe out its dominant source of public revenue, according to people briefed on Venezuela’s internal projections compiled in December.The Trump administration’s decision last month to begin targeting tankers carrying Venezuelan crude to Asian markets had paralyzed the state oil company’s exports. To keep the wells pumping, the state oil company, known as PDVSA, had been redirecting crude oil into storage tanks and turning tankers idling in ports into floating storage facilities.This strategy merely bought the company some time before it ran out of storage for the pumped oil its unable to sell. TankerTrackers, a shipping data firm, estimated late last month that Venezuela had enough spare storage until the end of January.But production could collapse swiftly after that, the people briefed said.If the blockade held, the Venezuelan government expected national oil production to collapse from about 1.2 million barrels per day late last year to less than 300,000 later this year, said the people briefed — a drop that would significantly reduce the government’s ability to import goods and maintain basic services. The people had access to the projections and discussed them on the condition of anonymity because they were not authorized to speak publicly.Mr. Maduro’s capture has only added more uncertainly to these projections.ImageA produce market in Caracas, the capital, in October. Oil exports account for 40 percent of Venezuela’s public revenues.Credit...Adriana Loureiro Fernandez for The New York TimesOil tankers on a U.S. sanctions list will continue being blocked from leaving or entering until the Venezuelan government opens its state-controlled oil industry to foreign investment — presumably giving priority to American companies — Secretary of State Marco Rubio said Sunday on “Face the Nation” on CBS News.“That remains in place, and that’s a tremendous amount of leverage that will continue to be in place until we see changes, not just to further the national interest of the United States, which is No. 1, but also that lead to a better future for the people of Venezuela,” Mr. Rubio said.But Venezuela’s interim government already appears to be testing the seriousness of that threat. At least 16 oil tankers hit by U.S. sanctions seem to have made an attempt to evade the blockade and leave Venezuelan ports since Saturday, in part by disguising their true locations or turning off their transmission signals.If they manage to breach the blockade and export the crude, Venezuela’s oil industry could buy itself some time to adjust to the new reality, the people close to the industry said.But if the blockade holds, the country would face a catastrophe, they added.In a worst-case scenario considered by Venezuela’s government, this year’s national oil production would be limited to only the fields operated by the American company, Chevron. It has a unique permit from the Trump administration to work in Venezuela, and is the only company regularly shipping oil from the South American nation since the start of the partial blockade on Dec. 11, shipping data shows.This scenario would force PDVSA, Venezuela’s largest employer, to furlough tens of thousands workers and slash employee benefits, the people briefed said.PDVSA and Venezuela’s communication ministry, which handles questions from news organizations, did not respond to requests for comment.In recent years, Venezuela’s economy had seen some modest economic recovery after years of hyperinflation and food shortages that led millions of Venezuelans to flee the country. But Mr. Trump’s economic pressure campaign has snuffed out that progress and now threatens to turn an anticipated recession into another economic collapse.Venezuela’s new leader, Delcy Rodríguez, was initially scathing in her criticism of the Trump administration, saying that its goal was “the seizure of our energy, mineral and natural resources.”ImageDelcy Rodríguez before being sworn in on Monday as the interim president.Credit...Alejandro Cegarra for The New York TimesOn Sunday night, however, her tone softened in a conciliatory statement addressed to Mr. Trump. “We extend an invitation to the U.S. government to work together on a cooperative agenda, oriented toward shared development, within the framework of international law, and to strengthen lasting community coexistence,” she wrote on social media.Oil exports account for about 40 percent of Venezuela’s public revenue, according to estimates by Francisco Rodríguez, an expert on the Venezuelan economy at the University of Denver. Mr. Rodríguez, who is not related to Delcy Rodríguez, added that the oil industry’s true economic impact is even larger, since much of the country’s remaining economic activity is financed by revenue from crude sales.ImageA refinery in Punto Fijo, Venezuela, in 2021.Credit...Adriana Loureiro Fernandez for The New York TimesMr. Trump has justified using force against tankers tied to Venezuela by claiming that the Venezuelan government has stolen oil and land belonging to America, apparently referring to the nationalization of foreign-operated oil fields in 2007. Starting on Dec. 11, U.S. forces seized two tankers carrying Venezuelan oil and attempted to board a third tanker as it sailed to Venezuela, leading PDVSA to largely stop authorizing shipments on tankers not associated with Chevron.So far, Mr. Trump’s partial oil blockade has had a limited impact on Venezuela’s oil output as the government stores crude oil wherever it can.Production from PDVSA’s joint ventures with other companies, which account for the bulk of the country’s total, fell 2.5 percent in December from the previous month, according to internal PDVSA data.Venezuela’s financial outlook is complicated by the fact that the government derives little direct financial benefit from Chevron’s exports. Its exemption from sanctions issued by the U.S. Treasury Department prohibits the company from actually making most payments to the Venezuelan government.Instead, Chevron compensates PDVSA for the right to pump oil from its fields by giving the company part of the crude from joint projects. But PDVSA has struggled to sell its share of that crude in recent weeks, putting pressure on its limited storage facilities.In a statement in response to questions for this article, Chevron said its operations in Venezuela fully comply with applicable laws and the U.S. sanctions framework. The company declined to provide further comment.ImageAn oil tanker chartered by Chevron waiting to load heavy crude for export in Maracaibo, Venezuela, in September.Credit...Issac Urrutia/ReutersChina, Venezuela’s biggest oil customer, is unlikely to significantly lean on the United States to ease the blockade, analysts say, since it can simply buy more from Iran or Russia.Venezuela’s ruling party has faced comparable economic pressures before.Oil exports collapsed to 350,000 barrels per day in the summer of 2020, during Mr. Trump’s previous effort to oust Mr. Maduro. And in 2002, oil workers allied with the Venezuelan opposition shut down the country’s oil industry for two months in a national strike.The government’s control over key factions of security forces allowed it to weather the economic pressure both times. In recent years, the government has boosted other sources of export revenue, including gold, iron ore and strategic minerals.Most of the brunt of the collapse of the oil revenue would be felt by the Venezuelan population, said Mr. Rodríguez, the economist.“We would see a massive recession,” he said. “You will get either a famine or mass migration.”Rebecca Elliott contributed reporting from New York.Anatoly Kurmanaev covers Venezuela and its interim government.SKIP