India’s largest refiner is signaling it may be ready to reopen a door it closed less than a year ago — if Washington lets it.
Reliance Industries said Thursday it would consider buying Venezuelan crude again if sales are permitted to non-U.S. buyers, showing just how quickly global oil trade patterns are being reshuffled after the United States moved to allow limited Venezuelan exports following the capture of Venezuelan leader Nicolas Maduro.
Reliance, which operates the world’s largest refining complex, stopped taking Venezuelan oil in early 2024, as the U.S. sanctions waiver on Venezuelan crude was set to expire. Its last cargo arrived in May. The company’s sprawling refineries in Gujarat are well suited to heavy grades like Venezuela’s Merey, making those barrels attractive when discounts are deep enough.
Industry sources also suggest that state-run refiners, including Indian Oil Corp and Hindustan Petroleum, may consider Venezuelan crude if restrictions ease. No one is committing just yet, but if Venezuelan barrels re-enter the market at the right price and with political cover, India is interested.
That posture is consistent with how India has long approached oil procurement. As a major net importer, New Delhi has rarely had the luxury of ideological purity in energy buying. Price, availability, and compatibility with refinery systems have usually mattered more than geopolitics, within the bounds of what sanctions allow.
India’s Russian crude purchases are a good example. Since Moscow’s invasion of Ukraine, India has become one of the world’s largest buyers of discounted Russian crude, a move it defended as essential to managing its import bill. Reliance itself sharply increased Russian intake at the height of the discount window, even as Western pressure mounted. Only recently has the company signaled a pullback, saying it would not take Russian oil in January as compliance risks rise.
Venezuela offers an alternative that Indian officials have quietly floated for months. New Delhi has told U.S. counterparts it could reduce its reliance on Russian crude if allowed to buy oil from Venezuela and Iran, warning that cutting off all sanctioned suppliers at once could push global prices higher. This is a scenario Washington is eager to avoid.
For India, discounted heavy crude improves refinery economics and diversifies supply. A welcome opportunity as trade risks multiply. For Washington, allowing purchases of Venezuelan oil could ease pressure on allies while redirecting demand away from Russian barrels.
If Venezuelan oil is legally available and attractively priced, it will simply be another tool in a procurement strategy built on flexibility. India’s buying habits continue to be rooted in necessity, which is unlikely to change.
By Julianne Geiger for Oilprice.com
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