Venezuelan oil: India confirms buying oil from Venezuela after 3 years and US’ leeway

Union Minister for of Petroleum and Natural Gas of India on Friday said that India will buy Venezuelan oil as some refiners in the country have the capability to process heavy crude oil. The last time India imported Venezuelan crude was in 2020.

Following the US lifting of sanctions in October, Indian refiners have already started buying Venezuelan oil again. Reliance Industries, Indian Oil Corp, and HPCL-Mittal Energy have all secured cargoes of Venezuelan oil.

“Many of our refineries, including Paradip, (are) capable of using that heavy Venezuelan oil. And we will buy (Venezuelan oil),” Puri told at a press conference.

India, world’s third-largest oil buyer, used to buy a lot of oil from Venezuela before the US imposed sanctions. These sanctions made Indian oil companies lose business to Chinese competitors in 2021. Since the US eased sanctions temporarily in October on Venezuela’s oil industry, people in the oil trade have been waiting to see if India will start buying oil from Venezuela again.

Puri added that India is willing to buy oil from any country that is not sanctioned.

“…if Venezuelan oil comes to market we welcome it,” Puri said.He also informed that India currently refines 5 million barrels per day of oil and the country’s refining capacity is rising. Puri further said that some Indian money is stuck in Venezuela, citing the case of India’s Oil and Natural Gas Corp., which has been holding onto dividend payments totalling more than $500 million for its investment in Venezuelan assets since 2014.

Interestingly, before the sanctions, India used to buy about 10 million barrels of oil from Venezuela every month. Reliance bought an average of five very big tankers of oil from Venezuela every month during 2018-2019, according to an analyst named Viktor Katona from Kpler, a company that studies this information.

(With inputs from Agencies)