Venezuelan crude imports: Reliance signals readiness

Venezuelan crude imports may soon resume for India as Reliance Industries signals conditional openness to buying Venezuelan oil. If the United States allows the sale of Venezuelan crude oil to non-U.S. buyers, will Reliance Industries of India be open to the purchase of Venezuelan crude? Reliance stated that they are waiting for a final determination of how to access Venezuelan oil and that they will only proceed with the purchase of crude oil from Venezuela if they do so lawfully.

If Reliance purchases Venezuelan crude oil, this will be the first time Reliance has purchased crude oil from Venezuela. Reliance operates the world’s largest single-site refinery in Jamnagar, Gujarat, India, and therefore has the ability to process the heavier types of crude oil produced in Venezuela.

Indian Refiners Explore Options as Market Shifts

Indian Oil Corporation and Hindustan Petroleum, both state-owned refiners, said they want to acquire Venezuelan oil supplies as soon as the U.S. lifts its sanctions on Venezuela. After President Trump imposed a 25% import tariff on crude oil from Venezuela on January 1, 2025, Indian refiners stopped importing crude oil from the country last year. Reliance Industry’s last Venezuelan shipment arrived during the month of May. Recently, the U.S. government allowed the import of $2 billion worth of Venezuelan crude oil following the arrest of President Maduro, which has increased interest from refiners who process large quantities of crude oil at discounted rates to improve their profitability.

Venezuelan Crude Imports Seen as Alternative to Russian Oil

The Indian oil industry has shifted towards sourcing Russian crude at discounted prices as a result of the impact of the ongoing conflict (Ukraine-Russia) on crude markets. The recent increase in compliance risk and pressure from Western countries has created barriers to purchasing Russian crude. In addition to the institution of an additional 25% tariff on Indian goods, the United States has recently instituted a 200% tariff on all Indian imports and is threatening to implement sanctions against any country that does business with the Russian Federation. The end of the purchase of Russian crude by Reliance in January indicates this change in strategy.

According to some experts, Venezuela has the potential to provide Indian oil refineries with a politically viable alternative, especially in light of the increased risks associated with Russian crude imports. If sanctions against Venezuela are lifted and/or if the international community allows non-U.S. purchasers of Venezuelan (oil) barrels to purchase and receive them legally, then Reliance and potentially other Indian oil refiners could re-enter the Venezuelan market and obtain inexpensive heavy crude.

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