India's Energy Security Largely Shielded by Diversified Sourcing Despite US–Venezuela Tensions

Airstrikes ordered by US President Donald Trump in Venezuela and the arrest of Nicolás Maduro on narco-terrorism and drug trafficking charges have unsettled global crude markets. Despite this tension, early assessments indicate India’s economy and energy security stay broadly insulated, as direct economic exposure to the US-Venezuela conflict has already shrunk.

Economic think-tank Global Trade Research Initiative views India’s current vulnerability as limited. "India faces negligible impact, as trade with Venezuela has collapsed under sanctions, with crude imports down 81.3 per cent in FY2025 and overall bilateral trade remaining marginal," GTRI founder Ajay Srivastava told PTI. Available trade data aligns with this cautious assessment.

Recent figures highlight how sanctions have reduced commercial ties. India’s total imports from Venezuela were $364.5 million in FY2025, including $255.3 million of crude oil. Crude purchases fell 81.3% from the $1.4 billion paid in FY2024. For an economy of India’s scale, such values are now minor within overall trade and import baskets.

On the export side, India sends limited volumes to Venezuela. Shipments reached $95.3 million in FY2025, with pharmaceutical products worth $41.4 million forming the largest share. The narrow size of both import and export flows helps explain why the direct trade fallout from the US-Venezuela conflict currently appears modest for India.

Two decades earlier, the pattern was very different. During the 2000s and 2010s, Venezuela served as a major crude supplier to India. At the peak, shipments exceeded 400,000 barrels per day. That relationship weakened sharply after Washington imposed sanctions in 2019, prompting Indian refiners to trim purchases to avoid exposure to secondary penalties.

Venezuela still plays a significant role in global oil balances because of its resource base. The country holds about 18% of the world’s oil reserves, exceeding Saudi Arabia’s roughly 16%. Russia holds about 5-6%, while the United States stands near 4%. Changes in Venezuelan production or access can therefore move global prices.

For Indian buyers, this means indirect exposure arises mainly through price swings rather than direct cargo flows. Any prolonged disruption under the US-Venezuela conflict could nudge benchmark crude prices higher. However, India’s diversified sourcing and reduced dependence on Venezuelan barrels help cushion the immediate shock from such shifts.

Country	Share of global oil reserves (approx.)
Venezuela	18%
Saudi Arabia	16%
Russia	5–6%
United States	4%

US-Venezuela conflict and potential upside for Indian oil investments

Industry sources and analysts consulted by PTI suggest Indian firms could even gain under certain scenarios. If Washington manages Venezuelan operations more tightly yet allows some reopening, nearly $1 billion of overdue payments to Indian entities could be released. Production might also restart more fully at blocks where Indian companies already hold equity stakes.

ONGC Videsh Ltd, the overseas subsidiary of ONGC, owns 40% of the San Cristobal oilfield in eastern Venezuela. US sanctions have restricted access to key technology, specialised services, and equipment at the site. These constraints leave commercially viable reserves stranded, limit operational influence for India, and restrict returns from an otherwise productive onshore field.

Venezuela has not paid ONGC Videsh Ltd $536 million in dividends up to 2014. Officials indicate a similar amount remains pending for later periods because Venezuelan authorities did not permit audits, which has effectively frozen India’s claims. A change in sanctions oversight could help unblock these dues and allow clearer accounting for the San Cristobal project.

Output at San Cristobal has reportedly fallen to around 5,000-10,000 barrels per day. Technical studies suggest the block could deliver 80,000-100,000 barrels per day with additional wells and upgraded kit. ONGC could move rigs from fields in Gujarat, as the Venezuelan asset requires similar rig designs that ONGC already operates domestically.

GTRI also points to geographical distance and pre-existing sanctions as further buffers for India. "Given the low trade volumes, existing sanctions constraints, and the large geographical distance, the current developments in Venezuela are not expected to have any meaningful impact on India's economy or energy security," PTI quoted Srivastava. For India, the main channel of concern stays global crude price volatility rather than direct trade disruption.