President Donald Trump announced on social media on the 16th that the Venezuelan government has been designated as a "foreign terrorist organization." The same day, he ordered a "complete and total blockade" on all sanctioned oil tankers entering or leaving Venezuela. As US sanctions escalate from economic measures to "physical disruption," the Nicolás Maduro government faces an unprecedented survival crisis, with the country's oil industry on the brink of collapse.

Reports on the 18th revealed that the US military has deployed what is described as the largest naval fleet in South American history to the Caribbean to enforce this order. Last week, a tanker carrying crude worth approximately $100 million was seized in a surprise raid. This military pressure has forced numerous tankers bound for Venezuela to turn around mid-voyage, while vessels awaiting departure have been delayed indefinitely.

An estimated one-quarter of the US Navy's active forces are now concentrated in the Caribbean. In addition to destroying over 20 speedboats accused of drug smuggling, US bombers and fighter jets have intensified patrols near Venezuela’s coastline, heightening pressure on the Maduro regime.

Despite Venezuela’s state-owned oil company PDVSA publicly insisting that exports remain "normal," the country’s crude logistics chain is nearing collapse. Internal sources disclosed that due to blocked exports, onshore storage capacity has dwindled to just five days’ worth of supply. This blockade not only severs Venezuela’s financial lifeline but also risks forcing a shutdown of its 1 million barrels per day (bpd) production capacity as storage fills up and diluent shortages worsen. WTI crude prices briefly plunged, currently hovering around $56 per barrel.

**Naval Blockade Seen as "Act of War"** The Trump administration’s move marks a fundamental shift in its Venezuela strategy. White House Chief of Staff Susie Wiles stated that the president aims to "keep hitting ships until Maduro raises his hands in surrender," widely interpreted as signaling regime change as the ultimate goal.

Edward Fishman, a former US official and sanctions expert, noted that a naval blockade intercepting most or all Venezuelan oil shipments constitutes an "act of war." He emphasized that such blockades typically precede conflicts rather than serve as mere policy tools. The US House of Representatives narrowly rejected two resolutions seeking to limit Trump’s military actions in the Caribbean, clearing some domestic political hurdles for the ongoing blockade.

Daniel Lansberg-Rodríguez of Aurora Macro Strategies commented that the Trump administration has pushed Maduro into an unprecedented imbalance: "Maduro is sitting on a pile of wet gunpowder, and the US is adding more. Whether it ignites remains to be seen."

**Storage Crisis and Diluent Shortages** PDVSA’s logistical bottlenecks have reached a critical point. An insider revealed:

"Our onshore storage can last only about five days. In the best-case scenario, offshore storage might extend this to seven days, depending on fleet operations."

If exports remain completely blocked, Venezuela’s crude production will become unsustainable. Guillermo Arcay of Harvard’s Growth Lab highlighted that beyond dwindling storage, PDVSA struggles to import petrochemicals essential for diluting its heavy crude. Trade intelligence firm Kpler reported that a Russian naphtha-laden tanker turned back last week, despite two earlier vessels successfully docking.

**Market Volatility and "Dark Fleet" Risks** Amid rising expectations of regime change, Venezuelan bond prices surged as investors repriced the likelihood of Maduro’s downfall.

However, not all oil flows have ceased. Chevron, which accounts for roughly a quarter of Venezuela’s 1 million bpd output, stated its operations comply with US sanctions and continue production.

Meanwhile, a "dark fleet" assisted by Russia and Iran persists. TankerTrackers.com CEO Samir Madani estimated 60% of such vessels remain off US sanction lists. Yet, with the US Navy tightening interceptions in the Atlantic and Indian Oceans, more tankers are retreating, sharply escalating transport risks even for unflagged ships.

**Economic Strangulation and Regime Survival** Christopher Sabatini of Chatham House labeled Trump’s oil blockade a "game-changer" for Maduro, pushing Venezuela toward total bankruptcy. Sabatini questioned whether illegal gold mining, drug trafficking, and money laundering could offset the massive revenue gap.

Venezuela’s economy continues to deteriorate rapidly. The bolívar’s depreciation has accelerated, dollar scarcity persists, and economists forecast inflation exceeding 500% this year. While Cuba endured six decades under sanctions, Venezuela’s larger population and elite accustomed to high living standards test the regime’s resilience.

Still, few predict Venezuela’s collapse without direct US military intervention, given the 25-year-old Bolivarian Revolution’s endurance and limited but ongoing support from allies like Russia and Iran. As Fishman noted, nonviolent economic pressure rarely topples regimes historically, but "when the US employs military force—as in Afghanistan or Iraq—it succeeds."