A US-led restructuring of Venezuela’s oil sector could translate into tangible economic and strategic gains for India, restoring access to a crucial source of heavy crude that Indian refiners are uniquely positioned to process, say analysts.
For India, the world’s third-largest oil importer, Venezuela once played a key role in energy security. Before US sanctions halted trade in 2019, India imported more than 4,00,000 barrels per day of Venezuelan crude at peak levels, largely feeding complex refineries operated by Reliance Industries and other public-sector players.
Analysts say a phased easing of sanctions, following Washington’s takeover of oversight of Venezuela’s oil sector, could revive these flows. That would immediately benefit ONGC Videsh Ltd (OVL), which is owed close to $1 billion in unpaid dividends and receivables accumulated over more than a decade. Of this, around $536 million relates to dues pending since 2014 from the San Cristobal oilfield in eastern Venezuela.
US sanctions imposed in 2020 blocked OVL from deploying rigs, accessing oilfield services and receiving dividend payments, forcing production to collapse to as low as 5,000–10,000 barrels per day. With restrictions lifted, output could be scaled up to 80,000–100,000 barrels per day using equipment redeployed from ONGC’s domestic fields, including Gujarat.
Beyond recovering dues, Indian companies could deepen their footprint. OVL holds an 11 percent stake in the Carabobo-1 heavy oil block, alongside Indian Oil Corporation and Oil India Ltd, which each own 3.5 percent. These assets become far more valuable if exports resume through internationally monitored channels.
Reliance Industries, the world’s largest operator of complex refining capacity, also stands to gain. Venezuelan heavy crude is well-suited to its refineries, allowing efficient blending, higher-value fuel output and greater supply flexibility. This reduces over-dependence on any single source, including Russia, at a time of shifting geopolitical alignments and ongoing India–US trade discussions.
Strategically, renewed Venezuelan supplies would give India an alternative to Middle Eastern crude, lower exposure to regional disruptions, and strengthen its hand in global price negotiations. As one oil industry executive put it, India is not returning to Venezuela—it is reclaiming an option it was forced to abandon.
