Trump’s Venezuela Oil Move Exposes Energy Motive Behind US Action

US President Donald Trump’s announcement that Venezuela would turn over 30-50 million barrels of sanctioned oil to the United States, finally confirms that the January 3 midnight attack on the oil-rich South American nation was driven by energy interests and the charges of narco terrorism were a façade.

‘’I am pleased to announce that the Interim Authorities in Venezuela will be turning over between 30 and 50 MILLION Barrels of high-quality, Sanctioned Oil to the United States of America. This Oil will be sold at its Market Price, and that money will be controlled by me, as President of the United States of America, to ensure it is used to benefit the people of Venezuela and the United States! I have asked Energy Secretary Chris Wright to execute this plan immediately. It will be taken by storage ships and brought directly to unloading docks in the United States,’’ Trump said on his X platform.

The announcement made within a week of the attack, and the subsequent ‘’capture’’ of Venezuelan President Maduro, showed Trump’s impatience and haste to take control of Venezuelan oil. The oil will be sold at market prices with proceeds managed by the US President himself.

This exposes Trump's lack of political and diplomatic judgment.

The announcement caused a slide in the global crude prices, although temporarily, because of the possibility of Venezuelan oil entering the market. However, it is too premature to conclude what impact, mainly long-term, the selling of 30-50 million barrels of oil by Venezuela will have on global oil prices.

Venezuela possesses the largest proven oil reserves in the world, estimated at around 303-304 billion barrels, even more than Saudi Arabia. Venezuela accounts for one-fifth of the global total.

The 30-50 million barrels represent a significant but short-term inflow. It is a small fraction of the 100 million barrels per day global market demand.

The Venezuela developments are not expected to have a direct impact on India’s economy and energy security because of minimal trade with the Latin American country. India's trade with Venezuela had declined to a great extent in recent years because of US sanctions. (India now sources about 0.3 per cent of its total crude oil needs from Venezuela.) This strategy has had an advantage for India as India did not have to depend only on Venezuelan energy supplies.

However, India can face an indirect impact if not a direct one. The Venezuelan situation will disturb oil markets all over the world, and India cannot claim any immunity. Therefore, it will be pragmatic to admit that the main impact for India is indirect and not direct. The indirect way would be due to an increase in global oil prices, which can affect India’s import bill, resulting in higher inflation and an impact on the Indian Rupee.

Indian public sector companies like ONGC Videsh Ltd. (OVL), Indian Oil Corporation (IOC), and Oil India Limited (OIL) hold significant stakes in Venezuelan oil projects. Sanctions have hurt these operations. About one billion USD in unpaid dues are stuck in Venezuela. It might now be difficult for the three companies to recover those dues. Therefore, the companies might recover the dues by raising the prices of petrol and diesel for domestic consumers.

India imports almost 85 per cent of its crude oil needs and is, therefore, vulnerable to global oil volatility. In FY 2025, Indian imports of Venezuelan oil were just 0.6 per cent.

Leading OPEC countries (which include Russia) are concerned about the potential economic impact because Venezuelan oil entering the market could push global oil prices lower, cutting into Russia's own oil revenue. China, a major buyer of Venezuelan oil, has significant financial stakes and large oil claims in Venezuela that are now in doubt.

The world's five major oil-producing countries and their approximate daily production in late 2025 are the US (21.9 million barrels a day), Saudi Arabia (11.1 million barrels), Russia (10.7 million barrels), Canada (5.8 million barrels) and China (5.3 million barrels). The US has been the world's top oil producer since 2018, while Saudi Arabia and Russia are key members of the OPEC alliance.

According to the OPEC 2025 edition of Annual Statistical Bulletin, Venezuela has the world’s largest proven oil reserves (303-304 billion barrels) followed by Saudi Arabia (267,200 billion barrels), Canada (163,440 mb), Iran (208,600 million barrels), Iraq (145,019 million barrels), Kuwait (101,500 million barrels), UAE (113,000 million barrels), Russia (80,000 million barrels), Libya (48,363 million barrels). The United States comes in tenth place with 45,014 million barrels)

India, with proven oil reserves of 4,981 million barrels, stands at 22nd place.

Trump’s announcement ‘’This Oil will be sold at its Market Price, and that money will be controlled by me, as President of the United States of America…,’’ is strong evidence that the action can be challenged in the International Court of Justice (ICJ).

However, even if the US action is challenged in the ICJ, it would face significant procedural hurdles, and even a favourable ruling for Venezuela would likely have limited practical impact due to US policy regarding the Court's jurisdiction. The ICJ can only hear cases if both countries involved agree to its jurisdiction. Also, the case would need to be brought by the State of Venezuela.

The US does not recognise the ICJ’s authority. Even though an ICJ ruling declares the US action unlawful and orders reparations or the return of oil, it would not have any impact on the US. However, an ICJ judgment can be referred to the UN Security Council for enforcement. But here also Venezuela does not have a chance because the US would veto the UNSC decision.

Venezuela has long accused the United States of being motivated by an interest in its vast oil and mineral resources.