The Trump administration's dramatic seizure of Venezuelan President Nicolas Maduro's assets has sparked a heated debate, with a focus on the impact on China and Russia, who stand to lose both their access to Venezuela's oil and the influence they've built up over decades. But here's where it gets controversial: the US may have structured the deal in a way that keeps China and Russia at a distance from the cash flowing from stranded oil. As a result, at least in the medium term, these countries won't be repaid their loans, and Cuba, which received oil in exchange for security and other services, has also lost access to a vital fuel source. The first sale of Venezuelan oil since the US seizure occurred last week, with traders Vitol and Trafigura reselling about $500 million of crude at prices 30% higher than the Maduro government had achieved under sanctions. The proceeds went to a US Treasury bank account in Qatar, keeping the funds out of reach of Venezuela's foreign creditors. The Trump administration has signed an executive order to protect these funds, claiming it as a custodial interest rather than a market participant. This move has significant implications for China, which has invested heavily in Venezuela for a quarter of a century, financing infrastructure and lending the government about $60 billion in discounted oil. China's state-owned companies are involved in oil and gas joint ventures, and it has been the major buyer of Venezuela's sanctioned oil. However, the US has made it clear that none of these creditors will get their hands on the petrodollars flowing out of Venezuela. This could have far-reaching consequences for China's influence in Latin America, where it has invested over $650 billion and has become the biggest trading partner with the region, supplying critical commodities and building infrastructure under the Belt and Road initiative. The Trump administration's actions in Venezuela may also encourage a shift in influence towards China, as the brutal intervention could bind Latin American countries closer to China and away from the US. The question remains: will China's influence in the region be undermined, and will the 'Donroe Doctrine' Trump espoused justify further interventions in the region?
