The US Treasury's sanctions on Venezuela’s state-owned oil company Petroleos de Venezuela, S.A., Monday could drive up crude prices and squeeze American refineries.
The United States is Venezuela’s biggest and most important oil customer, accounting for 39% of the OPEC nation’s deliveries last year, according to ClipperData. Venezuela was the fourth-biggest source of foreign oil that flowed into America last October.
American refineries take in hundreds of thousand of barrels of Venezuelan oil each day. The sanctions could hurt both the United States and Venezuelan economies.
US Treasury Secretary Steven Mnuchin said that Gulf Coast refineries have cut back their dependence on Venezuelan oil in recent months. “I don’t expect people will see an impact at the gas pumps,” he said.
The sanctions are part of an attempt to force President Nicolas Maduro to cede control of the country to opposition leader Juan Guaido.
The move “will help prevent further diverting of Venezuela’s assets by Maduro and preserve these assets for the people of Venezuela,” Mnuchin said in a statement.