Venezuela was bracing for a severe economic downturn as a U.S. blockade on its oil exports threatened to cripple the nation's primary revenue stream. Internal projections compiled in December indicated that the partial blockade, imposed by the United States, was expected to shut down over 70% of Venezuela's oil production in 2024.

The Trump administration's decision the previous month to target tankers shipping Venezuelan crude to Asian markets had effectively paralyzed the state oil company, PDVSA's, export capabilities. PDVSA had been attempting to mitigate the impact by diverting crude oil into storage tanks and utilizing tankers in ports as floating storage facilities. However, this strategy was viewed as a temporary measure.

TankerTrackers, a shipping data firm, estimated in late January that Venezuela's spare storage capacity would be exhausted by the end of the month. Once storage capacity was reached, production was expected to collapse rapidly. The blockade's impact extended beyond PDVSA, threatening the broader Venezuelan economy, which was heavily reliant on oil revenue for public spending and imports.

PDVSA, the state-owned oil and natural gas company, had long been the backbone of the Venezuelan economy. However, years of mismanagement, underinvestment, and corruption had weakened the company's infrastructure and operational efficiency. The U.S. sanctions further exacerbated these existing challenges, limiting PDVSA's access to international markets and financing.

The future outlook for Venezuela's oil industry and overall economy appeared bleak if the blockade persisted. The potential collapse of oil production would likely trigger a severe recession, further exacerbate shortages of essential goods, and potentially lead to increased social unrest. The long-term consequences for Venezuela's economic stability were significant, with the nation facing a protracted period of hardship and uncertainty.