03-27-2025

Imposing Tariffs on Countries Importing Venezuelan Oil

Executive OrderView the Original .pdf
View the Original .pdf

The 1-Minute Brief

What: Executive Order 14245, issued on March 24, 2025, authorizes the U.S. government to impose a 25% tariff on all goods from any country that imports oil from Venezuela. The order aims to further isolate the Maduro regime, which it links to the activities of the Tren de Aragua gang, designated by the U.S. as a Foreign Terrorist Organization.

Money: There is no official Congressional Budget Office (CBO) score for this executive order. The financial impact will depend on which countries are targeted and how they respond. The order authorizes a 25% tariff on all goods from identified countries, which could lead to increased costs for U.S. importers and consumers if those costs are passed on.

Your Impact: The most likely direct effect on an average American could be higher prices for certain imported goods. This would happen if tariffs are placed on a country that is a major trading partner with the U.S. and that country also imports Venezuelan oil.

Status: This Executive Order was signed by the President on March 24, 2025, and became effective on April 2, 2025.

What's Actually in the Bill

This executive order gives the Secretary of State the authority to impose a 25% tariff on all imports from countries determined to be importing Venezuelan crude oil or petroleum products. This measure is an addition to existing sanctions against the Venezuelan government and is intended to cut off a key source of its revenue.

Core Provisions:

  • New Tariff Authority: Authorizes the Secretary of State, in consultation with other agencies, to impose a 25% tariff on all goods from any country that imports Venezuelan oil, directly or indirectly, on or after April 2, 2025.
  • Discretionary Application: The decision to apply the tariff to a specific country is at the discretion of the Secretary of State.
  • Duration of Tariffs: Once imposed, the tariff on a country will expire 1 year after the country's last recorded import of Venezuelan oil, unless the Secretary of Commerce decides on an earlier termination.
  • Broad Definition: "Venezuelan oil" is broadly defined to include crude oil and petroleum products from Venezuela, regardless of the nationality of the company involved in its extraction or sale.
  • China, Hong Kong, and Macau: If tariffs are imposed on China, they will automatically extend to the Hong Kong and Macau Special Administrative Regions to prevent evasion.

Stated Purpose (from the Sponsors):

The order states its purpose is to address the ongoing national emergency concerning Venezuela. The administration claims the Maduro regime's actions and policies, including its alleged support for the Tren de Aragua transnational criminal organization, pose an "unusual and extraordinary threat to the national security and foreign policy of the United States." The stated goals are:

  1. To further pressure the regime of Nicolás Maduro.
  2. To counter the activities of the Tren de Aragua gang.
  3. To address Venezuela's destabilizing actions, such as undermining democratic institutions and contributing to a regional migration crisis.

Key Facts:

Affected Sectors: International Trade, Energy, Manufacturing, Retail.
Timeline: The authority to impose tariffs began on April 2, 2025. The order requires agency reports to the President every 180 days.
Scope: The order has a global reach, potentially affecting any country that trades with both the United States and Venezuela. Major importers of Venezuelan oil in early 2025 include China, India, Spain, Cuba, and Brazil.

The Backstory: How We Got Here

Timeline of Events:

The Venezuela Sanctions Era (2015-Present):

  • March 8, 2015: President Barack Obama issued Executive Order 13692, declaring a national emergency with respect to Venezuela. This order cited the Maduro government's erosion of human rights, persecution of political opponents, and significant corruption as a threat to U.S. national security.
  • 2017-2019: The Trump administration expanded sanctions through several executive orders. These included E.O. 13808, which targeted Venezuela's access to U.S. financial markets, and E.O. 13850, which laid the groundwork for sanctions on sectors of the Venezuelan economy. E.O. 13884, issued in August 2019, blocked all property of the Venezuelan government in the United States, effectively an embargo on dealing with state-owned entities like the oil company PDVSA.
  • February 20, 2025: The U.S. Department of State formally designated the Venezuelan gang Tren de Aragua (TdA) as a Foreign Terrorist Organization (FTO) and a Specially Designated Global Terrorist (SDGT).
  • March 14, 2025: The President invoked the Alien Enemies Act, citing an "invasion" by the Tren de Aragua gang, leading to the deportation of hundreds of Venezuelans.
  • March 24, 2025: The current Executive Order is signed, linking the actions of the Maduro regime and Tren de Aragua to justify new secondary tariffs.

Why Now? The Political Calculus:

  • Escalating Pressure: The order represents a significant escalation of the "maximum pressure" campaign. After years of direct sanctions on Venezuela, this move targets third-party countries, aiming to choke off the regime's remaining oil revenue streams.
  • Connecting Immigration and National Security: The order explicitly links the Maduro regime to the Tren de Aragua gang and the U.S. border crisis. This framing seeks to justify the economic action as a necessary measure to protect American cities and citizens.
  • Bypassing Congress: The use of the International Emergency Economic Powers Act (IEEPA) allows the executive branch to impose tariffs without needing new legislation from Congress, enabling swift and unilateral action.

Your Real-World Impact

The Direct Answer: This directly affects specific industries reliant on imports from countries that trade with Venezuela, but most Americans will only feel an impact if it leads to broad price increases.

What Could Change for You:

Potential Benefits:

  • Supporters argue that by crippling the Maduro regime, the policy could lead to a more stable and democratic Venezuela, potentially reducing regional migration and criminal activity in the long term.
  • The administration claims this action protects Americans from threats posed by transnational criminal organizations.

Possible Disruptions or Costs:

Short-term (3-12 months):

  • Higher Prices: If tariffs are levied on major U.S. trading partners like China or Spain, the cost of goods from those countries—ranging from electronics to clothing to food items—could increase for American consumers.
  • Supply Chain Disruptions: U.S. businesses that rely on components or finished products from targeted countries may face sudden supply chain interruptions and higher operating costs.

Long-term:

  • Trade Disputes: This policy could spark retaliatory tariffs from affected countries, leading to broader trade wars that could harm U.S. exporters, particularly in the agriculture and manufacturing sectors.
  • Shift in Global Trade: Companies might shift production and sourcing away from countries at risk of U.S. tariffs, causing economic disruption both abroad and potentially for U.S.-based multinationals.

Who's Most Affected:

Primary Groups: Importers of goods from countries that buy Venezuelan oil, U.S. consumers of those goods, and American companies with supply chains running through those nations.
Secondary Groups: U.S. exporters who may face retaliatory tariffs, and U.S. refiners who could see shifts in global crude oil prices and flows.
Regional Impact: The impact will be concentrated on countries that are major importers of Venezuelan oil, such as China, India, and Spain, and the U.S. ports and industries that handle goods from those countries.

Bottom Line: This executive order could make everyday products more expensive for you if they are imported from a country that the U.S. decides to penalize for buying Venezuelan oil.

Where the Parties Stand

Republican Position: "Holding Bad Actors Accountable"

Core Stance: Generally supportive of using strong economic measures to confront foreign adversaries and protect national security.

Their Arguments:

  • ✓ Praises the tough stance against the Maduro regime in Venezuela, which they view as an illegitimate dictatorship.
  • ✓ Supports linking national security to economic policy and immigration, framing the tariffs as a tool to fight crime and secure the border.
  • ⚠️ Some Republicans, particularly those from free-trade factions, may express concern over the broad use of tariffs and the potential for negative economic consequences for American businesses and consumers.

Legislative Strategy: Likely to defend the President's authority to act unilaterally on national security matters and support the executive order as a necessary foreign policy tool.

Democratic Position: "Tariffs Hurt Americans"

Core Stance: Generally critical of the broad and unilateral use of tariffs, arguing they often harm U.S. consumers and businesses more than the intended foreign target.

Their Arguments:

  • ✗ Oppose using tariffs as the primary tool of foreign policy, arguing it alienates allies and creates economic instability.
  • ✗ Argue that these tariffs will ultimately be paid by American families in the form of higher prices.
  • ⚠️ While opposing the Maduro regime, many Democrats would advocate for targeted sanctions and diplomatic engagement over broad secondary tariffs that could affect friendly nations.

Legislative Strategy: Likely to criticize the executive order for its potential economic fallout, introduce legislation to curtail presidential tariff authority, and call for a more strategic, multilateral approach to the Venezuela crisis.

Constitutional Check

The Verdict: ⚠️ Questionable

Basis of Authority:

The executive order cites the International Emergency Economic Powers Act (IEEPA) and the National Emergencies Act. IEEPA grants the President broad authority to regulate economic transactions in response to an "unusual and extraordinary threat" to the U.S. that originates substantially outside the country.

Relevant Portion of the Constitution (Article I, Section 8, Clause 3): "[The Congress shall have Power] To regulate Commerce with foreign Nations..."
Relevant Portion of IEEPA (50 U.S.C. 1701): Allows the President to "investigate, regulate, or prohibit... any transactions in foreign exchange" and "the importing or exporting of currency or securities" during a declared national emergency.

Constitutional Implications:

[Legal Principle]: The core legal debate is whether IEEPA's authority to "regulate... importation" grants the President the power to set tariffs, which are a form of tax. The Constitution explicitly gives Congress the power to "lay and collect... Duties, Imposts and Excises" (Article I, Section 8, Clause 1).
[Precedent]: The use of IEEPA to impose broad tariffs is a recent and legally contested interpretation. Historically, IEEPA has been used for sanctions like freezing assets, not for levying general import taxes. Federal courts have been skeptical of this use of the act.
[Federalism]: This issue does not directly involve federalism, as it pertains to foreign commerce, which is an enumerated federal power.

Potential Legal Challenges:

Legal challenges are highly likely and are already underway regarding similar uses of IEEPA for tariffs. Plaintiffs, likely to include business associations and states, will argue that the President is exceeding the authority granted by Congress under IEEPA and usurping Congress's constitutional power to set tariffs. Courts have previously ruled against the administration on this issue, though appeals are ongoing.

Your Action Options

TO SUPPORT THIS BILL

5-Minute Actions:

  • Call Your Rep/Senators: Capitol Switchboard: (202) 224-3121. "I'm a constituent from [Your City/Town] and I urge [Rep./Sen. Name] to support the President's use of executive authority in Executive Order 14245 to hold the Venezuelan regime accountable."

30-Minute Deep Dive:

  • Write a Detailed Email: Find contact information for members of the House Foreign Affairs Committee and Senate Foreign Relations Committee to express your support for a strong stance against the Maduro government.
  • Join an Organization: Groups that advocate for a strong U.S. foreign policy and support sanctions against authoritarian regimes may align with the goals of this order.

TO OPPOSE THIS BILL

5-Minute Actions:

  • Call Your Rep/Senators: Capitol Switchboard: (202) 224-3121. "I'm a constituent from [Your City/Town] and I urge [Rep./Sen. Name] to oppose Executive Order 14245. Tariffs are taxes on Americans and will not solve the crisis in Venezuela."

30-Minute Deep Dive:

  • Write a Letter to the Editor: Submit a letter to your local newspaper explaining how tariffs could raise prices for consumers and harm businesses in your community.
  • Join an Organization: Advocacy groups focused on free trade, consumer rights, or specific industries likely to be harmed by broad tariffs are likely to oppose this executive order.