New Delhi: In a turn of events few saw coming, the United States carried out a dramatic military operation in Venezuela and took President Nicolás Maduro from Caracas to the United States. Soon after, President Donald Trump made it clear that Washington intends to tap Venezuela’s vast oil reserves.
He has publicly stated that the United States will effectively run Venezuela until, in his words, there is a “safe, correct and sensible transition of power”. How this process will play out is still unclear, but the direction of US intent is no longer in doubt.
Venezuela holds the largest proven oil reserves ever discovered anywhere in the world. That reality has fuelled the belief that what has happened in recent days is driven less by regime change and more by control over oil.
President Trump wants American oil companies to pour billions of dollars into Venezuela, rebuild its shattered energy infrastructure and increase crude production. He has said American companies will revive the oil sector, restore facilities that have fallen into ruin and make substantial profits in the process.
So far, the White House has not released any formal policy document explaining how Venezuelan oil will be managed. Even so, the plan faces serious hurdles. Developing these reserves and lifting production will demand enormous capital and time.
The World’s Largest Oil Reserves
Venezuela is estimated to hold over 303 billion barrels of oil, the highest reserves globally. In the wake of recent developments, there is growing speculation that India may finally see a path to recovering nearly $1 billion in outstanding dues stuck in Venezuela.
News agency PTI reported this possibility after speaking to oil sector sources and analysts.
Before strict US sanctions choked Venezuela’s oil trade, India was among the country’s biggest buyers of Venezuelan crude. India is also one of the few nations equipped to process Venezuela’s heavy crude, both in terms of technology and refining capacity.
According to PTI, India once imported up to 400,000 barrels of Venezuelan crude per day. Growing risks linked to US sanctions and compliance with American laws pushed India to almost completely halt imports from Venezuela in 2020.
Data from India’s Ministry of Commerce and Industry shows that until November 2025, Venezuelan oil made up just 0.3 percent of India’s total crude imports.
India’s Investments In Venezuela
The ONGC Videsh Limited (OVL), India’s overseas oil arm, jointly operated the San Cristobal oilfield in eastern Venezuela. US sanctions blocked access to technology, equipment and essential services, making oil production unprofitable and forcing the OVL to stop operations.
The company holds a 40 percent stake in the field. PTI reported that by 2014, Caracas owed the OVL $536 million, a sum the country failed to repay. Nearly the same amount is outstanding in additional dues, which Venezuela did not allow to be audited.
What The Situation Means For India
As Venezuela’s political and economic situation changes swiftly, questions are being raised about what this means for India and whether the country stands to gain anything.
Analysts are divided, and much depends on the policies the United States adopts toward Venezuelan oil. They say the outcome hinges on whether Washington eases sanctions on Venezuelan crude.
They believe India is unlikely to get direct benefits, as the United States will want to retain control over Venezuelan oil.
The experts point out that India has the infrastructure to refine Venezuela’s heavy crude, opening the door to long-term advantages.
Venezuelan crude is dense and difficult to process, and India possesses the refining technology needed for such oil. If the US relaxes sanctions on Venezuela, the analysts say, the impact on India will come gradually, but strategically it will matter a great deal.
Venezuela’s heavy and high-tan crude has been processed in India’s refineries in the past. If supplies resume, this oil will likely come at discounted prices, which could work in India’s favour.
But a few experts read the situation differently. They believe Washington is signalling that it intends to refine Venezuelan crude itself and sell finished products in global markets.
Even if the United States takes control of Venezuela’s oil sector, it needs crude for its own consumption. The oil will be processed domestically and refined products will be sold internationally. For India, this creates neither a major gain nor a major loss. Overall, the impact will be neutral.
They say the US move shows a focus on Venezuela’s energy wealth, without worrying about how other countries react.
It is important to understand why the United States moved so aggressively in Venezuela despite anticipating global backlash. The answer lies in Venezuela’s enormous energy resources, which are estimated by some at nearly 300 billion barrels. On top of that, the country has substantial natural gas, gold and critical mineral reserves.
This is the real attraction, they say, adding that the United States wants energy self-sufficiency, wants to reduce dependence on the Middle East and Venezuela is its neighbour. That explains why Washington is doing all this to gain control over Venezuelan oil.
Many analysts feel that from a purely economic and oil supply perspective, developments in Venezuela are positive for India. Despite Caracas having vast oil reserves, its current production is only around 800,000 barrels per day because sanctions blocked investment.
ONGC Videsh has assets there that could not be developed. If US companies enter, as President Trump has indicated, production could rise to 2.5 million barrels per day within 18 months and reach 3 million barrels per day in two years. These are already developed fields. Global supply would increase, oil prices would face downward pressure, and for India, the world’s third-largest oil importer, that is a good news.
Will India Get Venezuelan Crude?
India is the world’s third-largest oil importer and depends on imports for 88 percent of its crude needs. In recent years, New Delhi has increased its reliance on Russian oil, a move that has drawn objections from Washington. It has told the United States that it is working to reduce purchases from Moscow.
The United States has imposed additional tariffs on India over Russian crude imports. Just on Sunday (January 4), President Trump warned that further tariffs could follow if India does not cut Russian oil purchases.
During ongoing India-US trade talks, New Delhi is actively diversifying its crude sources. The focus is on reducing risks from excessive concentration, in line with the broader US-led approach of lowering dependence on Russian oil.
Against this backdrop, Venezuelan crude is being viewed as a possible alternative.
In this context, Venezuelan crude emerges as one of the few discounted heavy options that India’s most complex refineries can process. Access to these barrels would help Reliance’s Jamnagar SEZ and MRPL produce at competitive rates, export to Europe in compliance with regulations and protect margins.
This would strengthen India’s energy security and improve its bargaining power with other heavy crude suppliers.
About the Author
