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The US has asserted that it will blockade all oil tankers from Venezuela on a sanction list. This action follows the seizure of the oil tanker Skipper that was carrying 2 million barrels of crude oil destined for Cuba. Generally speaking, a blockade is considered an act of war but the Trump Administration has not asked the Congress for a declaration of war, nor has it met the requirements of the War Powers Act. Nonetheless, Trump has deployed a massive military buildup off the coast of Venezuela acting on his asserted authority as Commander-in-Chief. The Washington Post listed all the military assets deployed as of today.

I doubt that the US is contemplating an invasion of Venezuela (but I also doubt that Trump has thought that far). His intention is to create economic chaos in Venezuela that will lead to the overthrow of President Maduro. This particular playbook was actually used by the Anglo-Iranian Oil Company (now known as BP) in 1951 against Iran after Iran nationalized its holdings. The company effectively blockaded Iran from selling its oil to others by following oil tankers leaving Iran and using the courts to prevent the sale of what it called “stolen” oil. Eventually, the Iranian economy collapsed and with a shove from the US CIA led to the overthrow of the president of the country and leading to the rule of the Shah of Iran.

The Iranian example is instructive since the Iranian regime that toppled the Shah in 1979 led to the creation of the Islamic Republic of Iran and the longstanding bitterness between Iran and the US today. The US has a poor track record of regime change. It did not work in Vietnam in 1963 when South Vietnamese President Diem was assassinated or when the US overthrew Iraqi President Hussein in 2003. Other examples include the overthrow of Guatemalan President in 1954 and the toppling President Allende of Chile in 1973. Regime change is a policy adopted by states that pay little attention to the long-term consequences of meddling in the internal affair of other states.

But there is another thread in the Venezuela situation that has not received sufficient attention. Venezuela has the largest oil deposits in the world although its oil is heavy with sulfur and thus requires significant refining in order to be useful. The main seller of Venezuelan oil in the US is a company called Citgo, and it has three refineries in the US. But the US took control of Citgo properties in 2018 using the Foreign Sovereign Immunities Act (FISA). In December 2025 Citgo shares were sold to a US company called Amber Energy with a $5.9 billion bid.

What’s interesting about Amber Energy is that one of its primary backers is Elliott Investment Management, a hedge fund based in West Palm Beach, Florida and whose primary sponsor is Paul Singer. Singer is often termed a venture capitalist (some call him a “vulture” capitalist) and an example of his activities was in profiting from Argentina’s debt problem in the early 2000s:

“Perhaps the most infamous chapter of Singer’s career is his prolonged battle with the government of Argentina over defaulted sovereign bonds. In the early 2000s, Argentina experienced a financial crisis that led to the country defaulting on its debt. While many creditors agreed to restructure their bonds at a fraction of their original value, Elliott Management refused, demanding full repayment. What followed was a 15-year legal and financial battle that saw Singer’s firm seize Argentine naval vessels and block international payments. In 2016, the dispute culminated in a $2.4 billion payout to Elliott Management, a victory that underscored Singer’s tenacity and strategic prowess.”

Regime change might result in a US company controlling all of Venezuela’s oil (if Maduro does leave, his most likely successor would be María Corina Machado who would likely have Trump’s blessing, although her political power will be sorely tested if she does not protest the US actions). In short, a US company would have control over Venezuela’s massive reserves.

Trump’s actions against Venezuela are reprehensible and short-sighted. The long-term consequences of Trump’s “gunboat” diplomacy will weaken US credibility and prestige, all in the name of preserving the viability of fossil fuel hegemony in the US. It is a fool’s errand and completely out of touch with the world as it currently operates.