Trump Threatens 25% Tariff On Countries Buying Venezuelan Oil, Compounding Global and U.S. Economic Fallout

President Donald Trump has launched a new economic offensive, threatening a 25% tariff on countries that purchase oil and gas from Venezuela.

Announcing the policy on his social media platform Truth Social, Trump said the tariffs—set to take effect on April 2—would apply on top of existing trade duties, placing additional pressure on Venezuelan President Nicolás Maduro and his largest buyer, China.

The move underscores the deepening rift between Washington and Caracas, as the Trump administration escalates its long-standing efforts to cripple Venezuela’s oil sector. At the heart of this strategy is a broader goal: curbing China’s growing influence in Latin America.

Venezuela, which exported 660,000 barrels per day (bpd) in 2024, relies heavily on Beijing as its biggest customer, with China purchasing about 270,000 bpd last year. The new tariff measure is widely seen as an attempt to disrupt that flow, forcing countries to reconsider their trade relationships with Venezuela—or face punitive economic consequences from Washington.

“If they buy their oil from Venezuela, they have to pay a 25% tariff to do business with the United States —that’s on top of existing tariffs,” Trump said during a press conference at the White House.

But while Trump portrays the tariffs as a strategic blow to Maduro and China, economists warn that his aggressive trade policies are part of a larger pattern of weaponizing tariffs to achieve political objectives—a tactic that could backfire, destabilizing global markets and dragging the U.S. into recession.

The administration’s reliance on trade restrictions as a tool of foreign policy has already led to economic turmoil in past conflicts, such as the U.S.-China trade war, and experts caution that Trump’s latest escalation could have severe unintended consequences.

Trump’s tariff announcement is designed to tighten the economic noose around Venezuela, which remains heavily dependent on oil exports as its primary source of revenue. The United States itself was the second-largest importer of Venezuelan crude in 2024, bringing in 233,000 bpd, while India and Spain purchased 61,000 bpd and 60,000 bpd, respectively.

Trump is betting that he can further isolate Venezuela and cut off vital funding for its struggling economy by imposing harsh financial penalties on countries that continue trading with Maduro’s regime.

The move is also designed as a direct challenge to China. Beijing has steadily deepened its economic and political ties with Caracas, using Venezuela’s oil as a bargaining chip in its broader geopolitical rivalry with the U.S. Analysts say that Trump’s latest move could increase tensions between the world’s two largest economies, prompting potential retaliatory measures from China that might exacerbate global market instability.

“This announcement by the Trump administration appears to be one more action targeting China,” Matt Smith, an oil analyst at Kpler, told CNBC.

The Deepening U.S.-Venezuela Rift

Trump’s tariff war against Venezuela is just the latest chapter in a deteriorating relationship that has spanned multiple administrations. Since taking office, the president has pursued a hardline approach to Maduro’s government, reinstating crippling oil sanctions that were briefly eased under former President Joe Biden.

Beyond the economic risks, Trump’s tariff war against Venezuela is exacerbating tensions on another front—U.S. immigration policy. The mass deportation of Venezuelan migrants under Trump has drawn intense criticism, with U.S. courts intervening to block some of his most extreme measures.

The tension reached a boiling point on Monday when a federal appeals judge told a Justice Department lawyer that the U.S. treated alleged Nazis better during World War II than the Trump administration treated Venezuelan migrants last week. The judge’s rebuke highlights the widening moral and diplomatic chasm between the two countries, as Trump continues to use both economic and immigration policies as tools to pressure Maduro’s government.

Tariffs as a Weapon—A Strategy That Could Backfire

Economists have warned that Trump’s weaponization of tariffs is a reckless economic strategy that could ultimately backfire on the U.S. Rather than simply punishing Venezuela, the tariffs could trigger a chain reaction of negative economic consequences that include higher oil prices resulting from supply disruptions forcing importers to seek alternative crude sources.

Already, the oil market is reacting. Brent crude futures rose 61 cents (0.85%) to $72.77 per barrel, while U.S. West Texas Intermediate (WTI) crude climbed 59 cents (0.86%) to $68.87 per barrel. If prices continue to surge, the cost of gasoline and household energy could rise sharply, undermining Trump’s claims that his economic policies are benefiting American consumers.

Leo Mariani, an analyst at Roth Capital, said Trump’s tariff war risks triggering an inflationary spiral. If oil prices surge beyond a certain point, it could force the Federal Reserve to keep interest rates high for longer, increasing the chances of a U.S. recession.

“We expect oil prices to go higher in light of this news and may rise further if Trump follows through with this proclamation,” He told clients in a note.

Chevron’s Special Treatment Highlights Policy Contradictions

Despite Trump’s aggressive stance against Venezuelan oil, his administration has quietly made an exception for Chevron, the last major U.S. oil company operating in Venezuela. On Monday, the U.S. Treasury Department extended Chevron’s license to operate in the country until May 27, a move that allows the company to continue extracting and exporting crude despite the broader crackdown.

Chevron CEO Mike Wirth personally lobbied top administration officials for the extension, emphasizing the company’s stake in five major oil projects in Venezuela.

Francisco Monaldi, a Latin America energy expert at Rice University, said the whole point of these tariffs was supposedly to cut off Maduro’s oil revenues. But by letting Chevron continue operations, Trump is sending mixed signals—showing that this is as much about controlling global oil flows as it is about punishing Venezuela.