How China's stakes in Venezuelan oil complicate Trump's plan

Key Highlights

• This comes as the US president is expected to travel to China in April to preserve the fragile trade truce he negotiated with Chinese President Xi Jinping late last year. STORY CONTINUES BELOW THIS AD“The administration appears focused on avoiding unnecessary escalation or new irritants with Beijing while keeping leverage firmly on Washington’s terms,” Craig Singleton, senior director of the China programme at the Foundation for Defense of Democracies, told AP_._More from Explainers The Donroe doctrine: How Trump’s Venezuela strike redefines US policy Will India have to pay 500% tariff for purchasing Russian oil?Singleton added that he does not expect Trump to turn Venezuela into a “flashpoint that complicates trade dynamics or Trump’s personal engagement with Xi.”China is owed at least $10 billion by Venezuela, according to multiple estimates.
• Former Venezuelan President Nicolás Maduro had been repaying that debt through oil shipments to China. But if the interim government aligns with Washington’s demands, it could challenge the legality of those oil-for-loan arrangements and halt further payments. According to a Morgan Stanley research note, two major Chinese state-owned companies — China National Petroleum Corp.
• and Sinopec — have claims to 4.4 billion barrels of Venezuelan oil reserves, the largest share held by any foreign nation. Editor’s Picks1Venezuela raid shows airpower drives dominance in modern conflicts 2Maduro’s abduction exposes Western hypocrisy, mockery of international lawUS companies are also owed tens of billions of dollars after Venezuela nationalised its oil sector.
• It remains unclear how these claims will be settled or in what order creditors will be repaid. This week, the US seized two sanctioned oil tankers as part of its broader effort to take control of Venezuelan oil exports. STORY CONTINUES BELOW THIS ADUS Energy Secretary Chris Wright said the US would manage the country’s oil sales “indefinitely,” placing the proceeds into American-controlled accounts that would eventually “flow back into Venezuela to benefit the Venezuelan people.”The administration also announced plans to launch those sales using 30 million to 50 million barrels from Venezuela’s crude storage facilities. When asked for further details, a Trump administration official, speaking anonymously to AP, said the policy aimed to reduce “adversarial outside influence” in the Western Hemisphere. Washington’s use of energy leverage follows China’s actions last year, when Beijing restricted exports of rare-earth magnets and used its soybean purchases as a tool in the trade dispute wit.