Washington: In a striking announcement aboard Air Force One on Saturday, U.S. President Donald Trump declared that India will pivot toward purchasing crude oil from Venezuela rather than Iran, signaling a major shift in global energy diplomacy and intensifying Washington’s role in reshaping international oil trade dynamics. The comments reflect deepening strategic coordination between the United States and India over energy supplies against the backdrop of geopolitical tensions and sanctions regimes.
Trump told reporters aboard the presidential aircraft en route from Washington to Florida that an agreement with New Delhi “has already been made, the concept of the deal,” in which India will begin sourcing Venezuelan oil instead of turning to Iranian crude. In the same breath, he extended an open invitation to China to also enter into a Venezuelan oil purchasing agreement with the United States, underscoring a broader diplomatic overture toward diversifying energy partnerships.
This development comes as the United States has been actively encouraging India to resume purchases of Venezuelan crude to help offset a sharp decline in Indian imports of Russian oil a consequence of mounting U.S. pressure and tariffs on such transactions. India’s Russian crude imports, which once exceeded 1.2 million barrels per day (bpd), are projected to fall significantly in the coming months as New Delhi seeks greater diversification in its supply mix.
The U.S. move marks a stark policy evolution. Last year, the Trump administration imposed a 25 percent tariff on countries, including India, that continued to buy Venezuelan oil, part of a wider effort to maintain pressure on Caracas amidst political tensions and sanctions. That levy had discouraged Venezuelan crude imports, prompting refiners like Reliance Industries to pause purchases amid uncertainty.
At the same time, longstanding U.S. sanctions on Iran have drastically reduced Tehran’s ability to export crude to markets like India, even though Iran was once among New Delhi’s top oil suppliers. Trump’s emphasis on Venezuelan oil over Iranian crude appears designed to reinforce Washington’s sanctions regime on Tehran, while offering New Delhi a plausible alternative source of heavy crude oil suitable for its refining sector.
India is the world’s third-largest crude oil importer and heavily reliant on foreign sources to meet its energy needs. Historically, New Delhi has diversified its imports across the Middle East, Russia, Africa, and the Americas. However, recent pressures from the United States including punitive tariffs linked to energy sourcing have nudged India to reduce its reliance on Russian supplies and explore other avenues.
Indian refiners, particularly those with capacity to process heavier, discounted crude grades such as those from Venezuela, stand to benefit economically if such supply lines are formalized. For instance, large complexes in Gujarat operated by Reliance Industries have equipment well-suited for heavier Venezuelan crude, potentially improving refining margins amid global price volatility.
Analysts suggest that the U.S. push for Venezuelan oil supplies to India is part of a broader strategy to undercut revenue streams that could finance Russia’s ongoing conflict in Ukraine, while simultaneously tightening the screws on Tehran and its energy sector. This is especially significant given that Iran’s crude exports have been constrained by sanctions, limiting its participation in global markets.
By inviting China into the fold of Venezuelan oil deals, the Trump administration is also treading into competitive energy diplomacy with Beijing even as U.S. China relations remain tense across trade, technology, and strategic competition arenas.
While Trump’s statement outlines a conceptual deal, concrete details remain sparse. It is yet to be seen how and when India will operationalize these Venezuelan oil purchases, whether through direct agreements with Caracas or via intermediaries, and how Tehran and Moscow might respond diplomatically or economically to such shifts. Moreover, global markets will be watching New Delhi’s decisions closely, as energy security remains a core concern for its rapidly growing economy.
Overall, this latest development indicates a significant reorientation of global crude flows, with implications for geopolitics, energy security, and diplomatic relations across several major powers.