Between April and August, India’s purchase of Venezuelan crude oil has grown multi-fold. The US’ demand for further purchase of Venezuelan oil and investment in that country can have commercial and strategic consequences for India, said GTRI.
On Tuesday US Secretary of State Marco Rubio said that he would encourage Indian refiners, particularly Reliance Industries to refine more Venezuelan crude and explore oil production in Venezuela to help India diversify its oil supplies.
India’s crude imports from Venezuela surged multi-fold from $255 million in FY2026 to $3.6 billion in just five months, April–August 2026. Purchases from the United States also increased, from $405 million in July 2026 to $790 million in August.
Venezuela’s crude is mostly extra-heavy and thick, tar-like hydrocarbon requiring specialized diluents, upgrading facilities and heated transport infrastructure before it can be refined or exported. While it is bought at a discount, it leads to lower yields and higher handling and refining costs.
Investing in the damaged Venezuelan oil sector and restoring output to its historical peak of more than 3 million barrels per day could take at least 7–10 years and require $75 billion to more than $100 billion.
Further, the US’ uncertain policy makes investments risky. “India had a bad experience investing in Venezuela during 2010–2020 and should be cautious about committing fresh funds. US sanctions disrupted ONGC Videsh’s investments and forced it to halt operations,” said GTRI.
Following the US’ 2019 Venezuelan oil embargo, Indian refineries had stopped buying Venezuelan crude to avoid secondary US sanctions. Hundreds of millions of dollars in Indian dividend earnings were stranded in Venezuelan accounts, production from Indian equity investments was effectively frozen, and plans to expand oilfield development and secure long-term crude supplies were abandoned.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: deccanchronicle.com
