India Turns to Venezuela as Gulf Conflict Disrupts Global Oil Supply Chains

According to energy tracking data, Venezuelan oil shipments to India have surged by nearly 50 percent compared to April levels. Venezuela has supplied India with approximately 417,000 barrels per day so far this month, up sharply from 283,000 barrels per day recorded in April. The increase comes after nine consecutive months during which no Venezuelan crude shipments reached India.

The development comes amid rising instability in the Middle East, where the conflict involving Iran has severely disrupted maritime oil transport routes. The Strait of Hormuz, one of the world’s most critical shipping corridors for crude oil exports, has effectively become inaccessible due to intensifying military tensions and security threats in the region.

Venezuelan Acting President Delcy Rodriguez is expected to visit India next week to discuss oil export agreements, according to United States Secretary of State Marco Rubio. Rubio himself is scheduled to travel to India from May 23 to May 26 for discussions focused on trade, defence cooperation and energy security.

Speaking about the growing energy partnership, Rubio said Washington wants India to increase purchases of energy supplies from the United States and Venezuela. He stated that the United States aims to sell India as much energy as possible while also exploring opportunities involving Venezuelan crude exports.

Venezuela possesses the world’s largest proven crude oil reserves, estimated at approximately 303 billion barrels, accounting for nearly 17 percent of known global oil resources. The reserves surpass those of both Saudi Arabia and the United States. However, years of sanctions imposed by Washington, combined with internal economic mismanagement, had significantly weakened Venezuela’s oil production capacity.

The current geopolitical crisis has prompted the United States to push Venezuelan crude back into international markets after Washington assumed control over Venezuela’s oil industry following the removal of former President Nicolas Maduro from Caracas in January.

India has simultaneously increased purchases of Russian crude oil amid the global energy crisis triggered by the conflict involving Iran. Washington has repeatedly expressed dissatisfaction over India’s continued imports of Russian oil, arguing that the revenues indirectly support Moscow’s military campaign in Ukraine.

Before the conflict involving Iran intensified, Prime Minister Narendra Modi had reportedly assured the United States in February that India would gradually reduce purchases of Russian crude and instead expand imports from the United States and Venezuela.

Analysts believe Washington is attempting to reshape global energy supply chains by reducing Iran’s leverage in future diplomatic negotiations while simultaneously strengthening American influence over Venezuela’s oil sector.

India had resumed limited imports of Iranian crude in April after a seven-year pause following temporary easing of United States sanctions. However, those imports have again stopped this month due to the ongoing United States naval blockade around Iranian ports.

At the same time, crude supplies from Saudi Arabia, previously India’s third-largest oil supplier, have sharply declined. Saudi shipments have reportedly fallen from approximately 670,000 barrels per day in April to nearly 340,000 barrels per day this month.

Indian authorities have also raised concerns regarding maritime security in the Gulf region. Officials confirmed that 13 Indian vessels remain stranded in the area, with New Delhi prioritising their safe return before dispatching additional tankers for fuel transportation.

Several India-linked vessels have recently faced attacks or seizures near the Strait of Hormuz and the coast of Oman. An Indian-flagged cargo vessel reportedly sank in Omani waters after a fire believed to have been caused by a drone or missile strike.

The disruption has intensified pressure on global oil supplies and increased demand for alternative crude exporters such as Venezuela.

India continues to rely partly on Russian crude already loaded onto tankers after Washington granted a 30-day extension of a sanctions waiver covering those shipments. However, analysts describe the arrangement as a temporary solution because India faces mounting pressure from the United States to reduce dependence on Russian energy.

Energy policy researcher Marc Ayoub stated that India’s immediate options are largely limited to sanctioned Russian crude or heavy Venezuelan oil. He said the waiver covering Russian shipments applies only to cargoes already loaded and noted that much of that supply has already diminished.

Ayoub further explained that although Russian crude remains available on international markets, volumes are no longer as high as earlier this year, while India’s domestic energy demand continues to rise significantly.

The search for alternative energy suppliers reflects Washington’s broader strategy of encouraging allies to diversify away from Iranian and Russian oil while redirecting global energy flows toward countries more closely aligned with United States geopolitical interests.

Venezuela’s vast reserves remain underutilised despite the country holding the world’s largest proven crude deposits. According to the United States Energy Information Administration, Venezuela currently contributes less than one percent of global crude supply because of years of sanctions and production decline.

Former Venezuelan President Hugo Chavez nationalised large sections of the country’s oil industry in 2007, redirecting profits toward social welfare programmes and reducing the influence of foreign corporations. Washington later imposed sweeping sanctions that restricted Venezuela’s ability to export oil and access global financial systems.

Chevron currently remains the only major United States energy company with significant operational activity in Venezuela, producing nearly 250,000 barrels per day through joint ventures with the Venezuelan state-owned oil company PDVSA.

ExxonMobil is also reportedly close to securing an agreement to re-enter Venezuela for the first time in almost two decades.

Critics argue that Washington’s campaign against Maduro was motivated not only by political concerns but also by strategic attempts to regain influence over one of the world’s largest oil reserves and replace Iranian crude with Venezuelan exports.

The strategy of expanding Venezuelan oil sales serves several objectives for Washington, including reducing Iran’s influence over global energy markets during peace negotiations while simultaneously integrating Venezuela’s oil sector back into the United States economic sphere.

Despite publicly criticising the United States-backed operation that removed Maduro, Rodriguez has reportedly received praise from President Donald Trump for cooperating with Washington and supporting new oil agreements.

Revenue generated from new Venezuelan oil export agreements remains tightly regulated through mechanisms overseen by the United States Department of the Treasury, while companies participating in the trade must comply with licensing conditions imposed by Washington.

Experts believe the simultaneous visits by Rubio and Rodriguez to India highlight how global energy diplomacy is increasingly shaped by the geopolitical consequences of conflicts involving Iran and Venezuela.

India shares longstanding ties with Venezuela’s energy industry. Indian state-owned firms led by ONGC Videsh entered Venezuela in 2008 to gain access to heavy crude reserves. By 2010, Indian consortiums had secured stakes in major projects including Carabobo-1 in the Orinoco Oil Belt. In 2012, India surpassed China to become the largest Asian importer of Venezuelan crude oil.

Before sanctions against PDVSA intensified in 2019, Venezuela ranked among India’s major oil suppliers. However, restrictions imposed by Washington forced Indian refiners and traders to significantly reduce purchases to avoid secondary sanctions from the United States.

The situation changed after the new authorities in Caracas signed fresh oil agreements with Washington following Maduro’s removal in January. Under the revised arrangement, selected companies received permission to purchase Venezuelan crude directly from PDVSA.

Venezuelan heavy crude is particularly suitable for Reliance Industries’ massive refinery complex in Jamnagar, Gujarat, one of the few refining facilities globally capable of efficiently processing ultra-heavy crude oil. However, only a limited number of Indian refineries possess the infrastructure necessary to refine Venezuela’s sulphur-rich heavy crude.

India’s total crude oil imports have now risen to nearly 4.9 million barrels per day this month amid the ongoing global energy supply crisis. The expected meetings involving Rodriguez and Rubio in India are likely to determine whether the current surge in Venezuelan oil exports to India evolves into a long-term strategic energy partnership.