China and India could both emerge as unlikely winners from possible U.S. sanctions on Venezuela's vital oil sector, according to one oil analyst.
President Donald Trump vowed to take "strong and swift economic" action ahead of Venezuela's controversial election for a new Constituent Assembly on Sunday. President Nicolas Maduro won the contentious vote, while the opposition party – and several of the crisis-stricken nation's neighbors – refused to recognize the result.
Stephen Brennock, oil analyst at PVM Oil Associates, told CNBC on Monday that the ramifications of sanctions imposed on Venezuela's oil sector could be far reaching.
"Venezuela would lose out on much needed oil revenues, U.S. refiners would be negatively impacted by a drop in refining margins and U.S. motorists by an increases in gasoline prices.
"However, there is one potential silver lining... Other major crude-importing nations such as India and China may stand to gain if they are offered Venezuelan crude at steep discounts," Brennock explained via email.
Venezuela's economy is almost completely at the mercy of the oil industry as it contributes around 95 percent of the country's exports. But a lack of investment in the industry has made it less and less profitable and productive.
Alastair Newton, director at Alavan Business Advisory, told CNBC on Monday that Maduro would most likely "survive" potentially forthcoming oil sanctions from the U.S., and suggested it may even embolden his cause.
"The big problem with sanctions is the more sanctions the Americans impose, the more Maduro is going to be able to claim – with some degree of credibility – that he is actually fighting an American attempt at regime change," he argued.
Meanwhile, a top commodities strategist told CNBC last week that Venezuela could become the first sovereign oil producer to "fully fail" if Maduro decided to move ahead and form a new legislative body.
Helima Croft, global head of strategy at RBC Capital Markets, said Venezuela would suffer "extreme economic duress" if the Trump administration decided to target the country's oil sector.
A crash in oil prices that started in late 2014 sent the economy into a tailspin. Now, the International Monetary Fund expects Venezuela's inflation rate to rise by a crippling 720 percent this year.
"With the country's foreign reserves recently having fallen below $10 [billion], (state oil company) PDVSA will be extremely hard pressed to avoid a disorderly default in the autumn or continue any semblance of regular salary payments," Croft said.
—CNBC's Fred Imbert contributed to this report.