Trump seems to be trying to collect on old bill of U.S. assets expropriated in Venezuela

The “total and complete” military blockade of oil tankers sanctioned by the United States that President Donald Trump announced on Tuesday seems to be seeking to collect a years-old debt of assets expropriated from American companies during the governments of Hugo Chávez and Nicolás Maduro, according to assertions by an administration official and a former ally of the regime in Venezuela.

“Venezuela is completely surrounded by the largest Armada ever assembled in the History of South America,” Trump posted on Truth Social. “It will only get bigger, and the shock to them will be like nothing they have ever seen before — Until such time as they return to the United States of America all of the Oil, Land, and other Assets that they previously stole from us.”

In what has been labeled by Caracas as part of an “irrational military blockade,” the U.S. deployed, beginning in August, an unprecedented military fleet in the southern Caribbean with the stated goal of combatting drug trafficking.

Four months later, Trump mentioned for the first time assets “stolen” by Venezuela, an allegation that appears to date back to the era of Hugo Chávez.

Trump appears to be trying to make claims on hundreds of expropriations, according to a former regime ally and now a hard critic of Maduro, Andrés Izarra.

“Today’s naval blockade is the armed collection of a bill that the courts already closed years ago,” Izarra, Chávez’s former minister of communications, posted on X, referring to claims by U.S.-based companies against the South American country after being abruptly cut out of the Venezuelan oil business more than 15 years ago.

Stephen Miller, the White House deputy chief of staff, also mentioned on Wednesday “pillaged assets” expropriated from U.S. firms by the Venezuelan government in recent years.

“American sweat, ingenuity and toil created the oil industry in Venezuela. Its tyrannical expropriation was the largest recorded theft of American wealth and property,” wrote Miller on X. “These pillaged assets were then used to fund terrorism and flood our streets with killers, mercenaries and drugs.”

Trump also announced Tuesday the designation of the Venezuelan regime as a foreign terrorist organization. Trump said Maduro’s “illegitimate regime” uses “stolen” oil fields to finance itself and sponsor “drug terrorism” and human trafficking.

In a statement released Tuesday night, Maduro’s government reaffirmed its sovereignty over all natural resources in Venezuela and denounced what it called the “grotesque threat” from the U.S. in the Caribbean.

Economist Francisco Monaldi, an expert on the politics and economics of energy, told CNN that Trump’s announcement is “a very aggressive extension” of the recent seizure of a sanctioned oil tanker loaded with Venezuelan crude that was seized by the U.S. military.

He added that a blockade could “be devastating” to Venezuela’s economy, already in disarray.

Expropriation of companies

“Expropriate!” was the phrase that the Venezuelan socialist leader Chávez popularized beginning in 2007 when announcing the government’s takeover of hundreds of Venezuelan and foreign companies.

Chávez began a series of nationalizations of foreign companies that provided services to the Venezuelan state, especially in the energy, oil and gas sectors.

The expropriation measures extended to other areas, such as food, production and even banking. It is estimated that more than 5,000 local and international companies were affected. Chavez argued that nationalizing foreign firms was “strategic” and that he was doing it for reasons of “sovereignty.”

The long list of U.S. companies affected by expropriations or unfulfilled agreements with the Venezuelan government iinclude ConoccoPhilips, Exxon Mobil, Cargill, Williams Companies, Owens-Illinois, Halliburton and General Motors, among others.

In February 2007, the first step in an avalanche of expropriations took place: the Venezuelan government announced the purchase of the electricity company Seneca and more than 80% of Electricidad de Caracas, both of which were owned by U.S. firms.

A few months later, the Venezuelan government took control of oil operations in the Orinoco Belt, in the east of the country, and launched a business model of joint ventures where Venezuela controls a majority percentage of shares.

Venezuela has never sold oil-producing land to foreign countries and companies. Instead, its governments have granted leases to foreign companies to explore, exploit and export oil, and it has signed association agreements with partners from abroad.

The Venezuelan oil industry was nationalized in 1976, two decades before Chávez, under the democratic government of President Carlos Andrés Pérez.

The property of the nation’s underground resources like oil and gas belong to the “republic,” according to the country’s constitution made official two centuries ago.

Chávez, who died in 2013 of cancer, ordered the expropriation of the rice processing plants of the U.S. company Cargill in 2009, accusing it of violating a law that controls prices for food production in Venezuela.

In May 2009, the government occupied a Cargill pasta plant and took control of a gas plant from U.S.-based Williams Companies Inc.

Chávez also seized thousands of acres of land from Venezuelan farmers and ranchers, assumed control of ports and nationalized dozens of companies working in the oil sector of Venezuelan capital that provided maintenance and transportation services.

The Venezuelan government also decreed the “forced acquisition” of the Margarita Hilton Hotel Complex, after the management contract of the Hilton chain expired.

In 2010, Venezuela nationalized 11 oil drills owned by the U.S. company Helmerich & Payne. That same year, Chávez authorized the expropriation of the U.S.-owned branch of Owens Illinois, a manufacturer of glass containers for beverages, food and medicines.

The expropriations included assets of Cemex (cement), Gruma (food) and Coca-Cola-Femsa of Mexico, Crystallex (mines) and Gold Reserve of Canada; Smurfit Kappa (food), from Ireland; and Casino (supermarkets) in France, among others.

The expropriations led to more than 40 arbitration complaints against Venezuela in the International Centre for Settlement of Investment Disputes, which is part of the World Bank.

The Venezuelan opposition, which led an interim government in 2019 to remove Maduro from power and to start a political transition, said that the country was facing more than 60 claims in foreign courts against the government and the state controlled national oil company PDVSA.

It remains unclear how many of those claims from private companies, including those from the United States, have been paid. Opposition representatives have estimated that the demands for expropriated property amounts to about 10% of Venezuela’s foreign debt.

Although the process of expropriation of local and international private companies continued during the first years of Maduro’s government, since 2013 his government has slowly authorized the return of some of those assets to private businesses.

An economist and former opposition congressman, Jose Guerra, said Chávez’s expropriation politics were “suicidal” and “an authentic disaster,” and that the Venezuelan government up paying more than $10 billion to companies whose assets had been taken.

“But it isn’t true that Venezuela stole U.S. oil and land”, Guerra, who is in exile abroad, posted on X. He said that the only U.S.-based oil company with a pending trial for Venezuelan expropriations is ConocoPhillips.

Guerra said he would like to see a political solution to the Venezuelan crisis.

“Venezuela is more than Chávez and Maduro, and the people don’t have to pay for what they did,” he said.