The US on Monday was considering sanctions on Venezuela that could include a ban on sales of US crude and refined products to the South American nation.
Such a move would hit Venezuela where it hurts because oil, much of it produced offshore, is the country’s main source of trade income and the economy is already reeling.
A range of sanctions is being considered in reaction to a controversial vote on Sunday that backed President Nicolas Maduro’s plan to rewrite the national constitution.
Critics say the move could pave the way for Maduro to become a dictator because the newly-elected constituent assembly will have the power to dissolve the opposition-held parliament.
On top of that, many observers consider Sunday’s election process to have been a sham.
So far, the only action taken by America is directed at President Maduro himself, freezing his assets in US jurisdictions, banning travel to the US and forbidding US entities from dealing with him.
That follows last week’s similar targeted sanctions on 13 other individuals tied to the Caracas government.
If the US takes oil-related action it would most likely entail only a ban on US oil being sent to Venezuela. State oil firm PDVSA depends on US light grades to dilute its own extra heavy grades to make them suitable for export.
A more blanket embargo that included banning Venezuelan exports to the US could be trickier for the Americans because cheap Venezuelan oil amounts to 10% of the crude imported by American refiners. Cutting that off would mean more expensive gasoline for the US.
Venezuela is in a prolonged period of economic and social unrest with high inflation, shortages of goods and frequent, violent street protests.