Tensions flared anew this week as National Assembly leader Juan Guaido moved to oust strongman President Nicolas Maduro, with the backing of the US and other countries.
In recent days, while the embattled socialist Venezuelan President, Nicolas Maduro, has gone on to sever diplomatic ties with Washington DC, the US Secretary of State, Mike Pompeo, has called upon all countries in the hemisphere to reject Maduro and "align themselves with democracy".
The selling was primarily driven by two factors: worries over a global economic slowdown and renewed concerns over U.S.
"Chevron operations in Venezuela continue and the company is committed to the country's energy development in compliance with all applicable laws and regulations", Chevron said in a statement.
IHS Markit Vice Chairman Daniel Yergin on the state of the oil market. The loss of Venezuelan barrels could drive up crude prices and squeeze American refineries that take in hundreds of thousand of barrels of Venezuelan oil each day.
"It's really the first quarter that's the big concern among investors right now", Matthew Blair, an analyst at Tudor Pickering Holt & Co., said Thursday in a phone interview.
In total, the net imports of crude oil and products in the United States during last week was 2.24 million barrels per day, down by 757,000 barrels per day from the previous week.
After Maduro broke off relations with the USA, the US threatened to impose sanctions on Venezuelan oil. In November, the Trump administration restored sanctions on Iran, a significant source of medium sour crude.
Brent crude oil futures were at 61.17 dollars a barrel at 0955 GMT, up 8 cents, or 0.13 per cent.
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Prices of heavier USA grades like Mars Sour, an offshore medium US crude, and Heavy Louisiana Sweet crude have risen as buyers scramble for supply. If this were back in October when oil prices were much higher, he may have punted on such a move, ' said Croft.
The US and Venezuela are dependent on each other and this latest political unpredictability could lead to changes that affect the US and Venezuela for years to come.
"There's a lot of doubt in the market that Trump will pull the trigger on oil sanctions" aimed at Venezuela, said Joe McMonigle, a former Energy Department official under President George W. Bush.
That would nevertheless be a significant setback for cash-strapped Caracas.
Venezuelan oil is predominantly heavy crude, which requires extensive refining.
"With the USA now clearly taking sides with the opposition, changes might be in the making", said Tamas Varga, an analyst at PVM Oil Associates Ltd.in London. If they can't get those [US] diluents, they can't export, ' said Grais-Targow.
Analysts said tough U.S. penalties on Venezuela's oil industry would be bullish for prices.
The row also has potential implications for OPEC.
Still, the long-term trend is a declining dependence on Venezuelan oil.