(Nairametrics) – U.S. President Donald Trump has announced plans to impose a 25% tariff on any country purchasing oil or gas from Venezuela, a move aimed at tightening economic pressure on the South American nation.
Trump, in a Truth Social post, accused Venezuela of hostility toward the U.S. and claimed—without providing evidence—that the country had sent criminals, including gang members, into the United States.
“Venezuela has been very hostile to the United States and the Freedoms which we espouse. Therefore, any Country that purchases Oil and/or Gas from Venezuela will be forced to pay a Tariff of 25% to the United States on any Trade they do with our Country,” Trump stated.
Potential Impact on Nigeria’s Gas Deal
Trump’s tariff proposal raises questions about the potential impact on existing international agreements, particularly Nigeria’s recent energy partnership with Venezuela.
- In August 2024, Nigerian firm Veneoranto Petroleum Limited, a subsidiary of Atlas Oranto, signed an agreement with Venezuelan state-owned PDVSA to develop natural gas projects in the Barracuda Area (Gulf of Venezuela) and the Boca de Serpiente Area (Delta Amacuro).
- The agreement includes technical and economic feasibility studies to develop these areas, marking a significant step in Nigeria’s expansion into South American energy markets.
- The signing ceremony was attended by Venezuelan President Nicolás Maduro, Petroleum Minister Pedro Tellechea, and Nigerian businessman Arthur Eze, representing Veneoranto Petroleum Limited.
With the proposed U.S. tariff, Nigeria’s partnership with Venezuela may face increased scrutiny, potentially affecting the viability of future energy projects.
Venezuela’s Global Oil Trade and U.S. Sanctions
Despite U.S. sanctions, Venezuela remains a key player in the global oil market, producing 921,000 barrels per day (bpd) in 2024, according to Lipow Oil Associates.
- China is the largest importer of Venezuelan oil, receiving 351,000 bpd.
- The United States imported 228,000 bpd, largely due to a joint-venture license granted to Chevron that allows limited oil trade with Venezuela.
- The U.S. Treasury Department recently extended this license until May 27, 2025, exempting certain Venezuelan oil transactions from sanctions.
- The Biden administration had temporarily lifted sanctions on Venezuelan oil in 2023, only to reimpose them in April 2024, citing the lack of free and fair elections under President Nicolás Maduro.
International Reactions and Economic Implications
Trump’s tariff announcement drew strong criticism from Venezuela and its largest trading partner, China.
- President Nicolás Maduro condemned the move as an illegal attempt to undermine Venezuela’s sovereignty and economy.
- China’s Ministry of Foreign Affairs criticized the U.S. for interfering in Venezuela’s affairs and called for the removal of unilateral sanctions.
- If fully implemented, Trump’s policies could escalate trade tensions with China, potentially leading to higher tariffs on Chinese goods (up to 45%) and steel and aluminum taxes rising to 70%.
What You Should Know
- The global energy market may experience increased volatility due to potential disruptions in Venezuelan oil exports.
- Veneoranto Petroleum Limited’s partnership with PDVSA aligns with Nigeria’s expanding energy strategy, but it now faces uncertainty.
- U.S.-China trade relations could deteriorate further, impacting global oil prices and supply flexibility.
As the Trump administration moves forward with its economic policies, analysts will closely monitor the geopolitical and financial consequences, particularly for Nigeria’s energy sector and global oil markets.
