Venezuela
South American OPEC member; world's largest proved reserves; OFAC-sanctioned crude exporter; PDVSA in decay.
Venezuela quietly halted its crude shipments to Cuba in November 2025, a cut-off Havana's energy minister only revealed on 13 May 2026 and which underlies Cuba's repeated total grid collapses through mid-July.
Last refreshed: 4 August 2026 · Appears in 2 active topics
Has Venezuela's crude supply to Europe recovered since the PDVSA collapse?
Timeline for Venezuela
Mentioned in: GAESA was designated first, on 7 May
Cuba DispatchMentioned in: Wind-down licence lapses for blocked ships
Iran Conflict 2026Mentioned in: State Security rang about his US visa
Cuba DispatchMentioned in: OFAC cuts the Iranian-oil waiver short
European Oil MarketsMentioned in: A week, no US Iran order signed
Iran Conflict 2026Background
Venezuela holds the world's largest proven crude oil reserves, estimated at over 300 billion barrels, concentrated in the Orinoco Belt. Production has collapsed from around 3 million barrels a day in the late 1990s to under 800,000 barrels a day, driven by US sanctions, investment flight and state-company decay at PDVSA. The country has been under a layered US sanctions regime since 2019, with OFAC general licences carving out specific exemptions for Chevron and a handful of other operators under conditions that vary with each renewal.
Under the Maduro government Venezuela was aligned with Russia and China, and its crude flowed primarily into the discounted sanctioned-barrels market served by Chinese buyers and dark-fleet tankers, a pattern it shared structurally with Iran. Maduro was captured by US forces under Operation Southern Spear, and the resulting political transition, including its effect on PDVSA operations and that alignment, remains unsettled. Venezuela's Merey heavy crude competes with Canadian heavy crude and Iraqi Basra Heavy for Atlantic Basin refinery slots serving Spain and the Netherlands, though current restrictions mean European buyers need specific licences to transact it at all.
Its Cuba supply stopped months earlier
Venezuela quietly stopped shipping crude to Cuba in November 2025, Havana's energy minister disclosed on 13 May 2026, months before the 18 March PDVSA Treasury authorisation originally blamed for the cut-off. That timeline puts the halt on Caracas's own ledger: PDVSA's continuing production decline, Havana's inability to pay in hard currency, or diversion of Venezuela's shadow-fleet tankers to better-paying Asian buyers, rather than any US sanctions order.
The gap has not closed. Cuba's two total grid collapses in mid-July 2026 trace back to the same absence of Venezuelan crude first disclosed in May, reading as a delayed consequence of Caracas's own November decision rather than a fresh external shock.
Its oil licences never paused
Venezuela's OFAC sanctions channel stayed open through the Iran war's early weeks even as Washington's Iran sanctions file went silent. On 18-19 March 2026 Treasury authorised PDVSA to resume selling crude globally through a US-controlled payment account, the same week Trump waived the Jones Act for 60 days; neither measure touched the Hormuz closure driving Brent toward its wartime peak.
The contrast sharpened as the war continued: OFAC issued new and amended Venezuela licences on 27 March and 8 April while producing zero Iran-related actions across the same 42-day window, evidence that Caracas's own sanctions relationship with Washington kept moving on its own administrative track regardless of the Iran war's course.
Did Venezuelan oil ever reach Cuba in 2026?
When did Venezuela stop supplying oil to Cuba?
Does OFAC actively maintain Venezuela sanctions?
Why is Venezuela relevant to the Iran war coverage?
Does Venezuela still sell oil to Europe?
Why is Venezuela under US sanctions?
What is the Orinoco Belt and why does it matter?
How much oil does Venezuela produce in 2026?
