Analysts and business leaders'said that foreign currency flows into Venezuela's private sectors, in both cash and cryptocurrency could?fall over the next few weeks, after Washington ordered a blocking of oil tankers as part of sanctions. This would likely stoke inflation in Venezuela, an OPEC member.

U.S. president Donald Trump ordered on Tuesday Washington's latest "move" to pressure Venezuelan President Nicolas Maduro by targeting his government's main source of income. Trump's anti-Maduro campaign has included a buildup of military forces in the region, and over two dozen attacks on boats that the U.S. claims were drug traffickers and killed at least 90 people. Trump has repeatedly said that U.S. land attacks against Venezuela could start soon, and that Maduro must leave office. However, the Venezuelan President appears to have a firm military support as well as the backing of both his cabinet and other allies like Russia.

OIL BUYERS DEMAND VENEZUELA CONCESSIONS

Maduro, his government and the U.S. have denied all 'connections' to drug trafficking. They claim that they are seeking a change in leadership to gain control over Venezuela's natural resource reserves, including its vast crude reserves. Sources have said that Venezuelan oil consumers are already demanding steeper discounts, and a change to spot contracts due to a vessel seizure. Around 80% of all exports are sent to Asia.

U.S. sanctions force companies in?Venezuela that want to import raw materials to exchange bolivars into dollars generated from the oil trade or foreign card transactions on the exchanges managed by the central bank. Analysts and business leaders say that uncertainty about crude shipments could reduce oil revenue and the amount of cryptocurrency and cash available to industries.

Alejandro Grisanti, an economist, said: "This could be the most powerful action by the United States." The government's allocation of foreign currency to businesses was already decreasing. According to estimates from local financial firms and analysis companies, they totaled $5 billion between January and November, a 16% drop from the same time period in 2024. Analysts added that flows could fall even further as the U.S. sanctions could affect half of oil exports.

Worries about Dollar Availability

Financial sources reported that the dollar supply and crypto supply were 6% lower on Monday than they had been the week before.

One businessman, who asked to remain anonymous, said that private sector executives were concerned about the availability of dollars in the near future. However, another source stated that manufacturers have sufficient inventory at present to meet consumer demands.

The central bank and the communications ministry did not respond to requests for comment. Vice President Delcy Rodriguez stated on Wednesday that crude oil exports continued despite an "illegal and illegal blockade". Maduro's Government has gradually begun to allow dollar-tied cryptocurrencies, such as USDT (also known as Tether), in private currency exchanges. The change was made after a U.S. licence allowing Chevron Venezuelan crude exports but prohibiting payments to Maduro’s government.

Another analyst who requested anonymity said that a low supply of dollar in any form would pressure the exchange rate. In Venezuela's economy, the devaluation is reflected in prices.

Analysts said that the official exchange rate depreciates by around 1% per day, forcing families and individuals to pay more money for essentials such as food, medicine, and other necessities. Some worker bonuses, previously paid in foreign currencies, are now paid in bolivars index to the exchange rate.

According to the International Monetary Fund, Venezuela's inflation could reach 548% by year-end. Since October 2024, the central bank hasn't published any price data. Rod Nickel (Reporting and Editing)

(source: Reuters)