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The Center on Global Energy Policy at Columbia University SIPA is closely following recent US actions in Venezuela and their impact on geopolitics, policy, and global energy markets. See all of our coverage here.
- The US intervention in Venezuela is jeopardizing the flow of discounted Venezuelan oil to China’s teapot refineries and will likely impact the role of Chinese oil companies in Venezuela’s upstream business.
- The Trump administration has stated that all Venezuelan oil will now flow through legitimate and authorized channels consistent with US law and national security.
- A fraction of Venezuela’s oil exports to China are allocated for repaying debt, which is estimated to be US$10 billion–$12 billion, less than 10% of Venezuela’s total debt.
- The US intervention has increased the geopolitical risk of future Chinese investments in Latin America.
The implications of the US removal of President Nicolas Maduro from Venezuela to face charges in US courts go beyond Venezuela, testing the Trump administration’s stated national strategic goal of limiting the presence and influence of “non-hemispheric competitors,” notably China, in the Western Hemisphere. This goal includes any significant sway over the region’s natural resources.
President Donald Trump’s focus on Venezuela’s oil reserves, and recent moves to direct all the oil flows from Venezuela, therefore, will adversely impact China, Venezuela’s largest oil customer and an important creditor.
In this Q&A, senior research scholars Erica Downs and Luisa Palacios share their thoughts on the impacts of US actions in Venezuela on China’s oil ties to the country and the fate of Venezuela’s unpaid debt obligations to China. It also considers what signals this US action might be sending for Chinese interest elsewhere in Latin America.
How much oil does China import from Venezuela?
Erica Downs: Venezuela is a modest supplier of crude oil to China. According to China’s General Administration of Customs, China imported just 30,000 barrels per day (bpd) of crude oil in 2024. However, the actual number is much higher. According to Kpler, more than half of Venezuela’s crude exports of 768,000 bpd last year went to China, accounting for about 3 percent of China’s total crude imports. The discrepancy is due to the efforts of shippers to conceal the crude’s Venezuelan origin. These steps include using shadow fleets and ship-to-ship transfers and rebranding the crude as that of a third country such as Malaysia or Brazil. In addition, shippers have spoofed the location signals of tankers departing Venezuela to make it look like they are setting sail from other countries.
What role do China’s national oil companies play in Venezuela’s upstream business?
Luisa Palacios: Despite having a large footprint on paper, Chinese companies are not the largest producers in Venezuela; US-based Chevron is. I estimate that Chevron represents more than 25% of the country’s production of almost 1 million in bpd, while Chinese oil production might be about 10%.
While the first oil project with China dates back to 1993, the Chinese presence in Venezuela did not significantly increase until the 2000s, when the then-Chavez government signed a number of oil partnerships with CNPC and China’s Petroleum and Chemical Corporation (Sinopec) in both conventional and heavy crude oil.
CNPC has a total of five different oil projects in Venezuela (see Table 1), including two in the Orinoco belt, most of which are inactive. Chinese oil activity is concentrated in the heavy oil Sinovensa joint venture (JV), estimated to produce around 100,000 bpd.
Sinopec had one JV with Venezuela’s state-owned oil and gas company PDVSA encompassing conventional crude, but in February 2025, the Chinese company signed an agreement for the sale of its shares to US-based Amos Global Energy Management (AGEM), contingent upon approval by the Office of Foreign Assets Control of the US Treasury and the Venezuelan government (see Table 1).
In 2020, the former Maduro government passed a controversial Anti-Blockade Law to bypass US sanctions. Under this new regime, the Maduro government has been able to sign new oil contracts with complete lack of transparency akin to product-sharing agreements with three unknown Chinese companies. The most controversial of these new Chinese ventures, given that its parent company is sanctioned by the US, is China Concord Petroleum, which before US actions was expected to invest US$1 billion by the end of 2026.
Table 1. Chinese contracts in Venezuela’s oil industry
Note: Several ventures in this table date to the oil liberalization that took place in the 1990s. The official dates reflect new contracts signed under Chavez in the 2000s, forcing majority equity participation by PDVSA in all existing ventures. This resulted in expropriation claims by US and European companies but were accepted by Chinese state-owned companies.
Source: PDVSA Annual Reports, Transparency International, S&P, Reuters.
How much money does Venezuela owe China?
Palacios: Chinese financial institutions, primarily the China Development Bank, loaned Venezuela around US$60 billion through 17 different loan contracts—about half the Chinese loans committed to Latin America, as of 2023. Repayment of these loans were supposed to be in the form of oil shipments to China.
Problems with repaying Chinese loans started in 2016, and since then the Venezuelan government has fallen into significant arrears on its Chinese debt service payments. Negotiations between Chinese and Venezuelan officials since then have focused on redefining the terms of payment of the debt, made significantly more complex by US sanctions on the country. While most of Venezuela’s oil exports have China as their final destination, only a fraction of those oil exports are meant to cover Venezuela’s debt service payments. As of 2019, the stock of debt with China stood at US$16.7 billion, and it is believed to be around US$10 billion–$12 billion as of 2025. If this is accurate, then only a fraction of oil shipments (probably between an average of 50,000 to 100,000 bpd since 2020) have been allocated for Chinese debt repayments. Otherwise, the totality of that debt would have been paid already. But not even those barrels to pay down Chinese debt will flow with recent US actions.
With Venezuela’s total stock of debt estimated at between US$150 billion–$200 billion, Chinese debt obligations represent less than 10% of Venezuela’s debt.
How is China responding to the events in Venezuela?
Downs: China has condemned the Trump administration’s military operation to remove President Maduro and his wife from Venezuela, and called for their immediate release and for the United States to “stop toppling” the Venezuelan government. Despite Beijing’s displeasure with the events in Venezuela, there are some silver linings for China. First, Chinese officials are capitalizing on the US intervention to portray the United States as a bully, a violator of international law, and a source of regional instability. Second, Beijing can take advantage of the US strike on Venezuela to push back against any US criticism of Chinese efforts to bolster its claims to disputed parts of the South China Sea. However, Beijing is unlikely to view the US intervention as a justification for military action against Taiwan, which it regards as an internal affair.
What does the Trump administration’s intervention in Venezuela mean for China’s energy ties to Venezuela?
Downs: It has different implications for different Chinese actors.
Teapot Refineries: The US intervention in Venezuela may jeopardize the supply of Venezuelan oil to its main buyers in China, small independent refineries known as “teapots.” These refiners, which operate on thin margins, are avid purchasers of sanctioned crudes because of the steep discounts they can obtain. The large volume of Venezuelan oil stored on tankers off the coasts of China and Malaysia—about 82 million barrels—should shield the teapots from any disruption of Venezuelan exports over the next few months. But longer disruptions may force the teapots to choose between paying higher prices for alternative supplies or making do with less. According to Kpler, heavy Iranian crudes can substitute for Venezuela’s Merey crude and be obtained at a discount but won’t be able to completely replace lost Venezuelan barrels, while certain Canadian and Iraqi grades might be too expensive.
National Oil Companies: China’s NOCs—and construction companies—have the expertise and experience to help rebuild Venezuela’s oil infrastructure to include pipelines, power plants, and ports. They also have capital to invest in exploration and production. But whether their involvement will be welcomed by the Trump administration is an open question. Not only has President Trump said that US oil companies will “spend billions” to reconstruct Venezuela’s oil industry, Secretary of State Marco Rubio has stated that the US does not want China and other US adversaries to control that industry.
In the very near term, major Chinese oil companies are also bearing the brunt of oil production reductions in response to the US’s continued blockade. On January 4, PDVSA began reducing oil production, including output from the company’s Sinovensa JV with CNPC, a portion of which is exported to China to repay loans. The timeframe for ending the oil blockade is vague, with Secretary Rubio stating that the US will maintain it until “conditions that are in the national interests of the United States and the interests of the Venezuelan people are met.”
State-Owned Banks: The US intervention is putting Venezuela’s ability to service its Chinese debt at risk. Going forward, the Trump administration might also pressure Caracas to prioritize repaying US creditors, and Chinese banks could suffer losses as a result, according to Victor Shih of the University of California, San Diego.
Is the US intervention in Venezuela sending China signals about its other interests in the Latin American region?
Palacios and Downs: Among the rationales for the US intervention in Venezuela, Secretary Rubio mentioned the national security implications of having US adversaries use Venezuela as a hub for their activities in the region, in addition to controlling Venezuela’s oil reserves—the largest in the world. His comments are consistent with statements in the US National Security Strategy of “denying non-hemispheric competitors the ability to position forces or other threatening capabilities, or to own or control strategically vital assets, in the Western Hemisphere.”
Underscoring this position is the Trump administration’s announcement that all the oil transported in and out of Venezuela will be through “authorized channels consistent with US law and national security.” With these actions, the US government is positioning itself front and center in the marketing of Venezuelan oil, starting with the 30 to 50 million barrels per day to be shipped into the United States.
US actions in Venezuela, therefore, are likely to increase the geopolitical risk of future Chinese investments in Latin America, particularly in key sectors such as mining, energy, and infrastructure. The secretary’s statements and the security strategy make evident the strategic importance of Latin America in US foreign policy.