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Imports by India from Venezuela
India is set to resume oil imports from Venezuela after a hiatus of three years, following the easing of United States sanctions on Caracas. This development marks a significant shift in India’s oil procurement strategy, opening avenues for private sector giants like Reliance Industries (RIL) and Nayara Energy (NEL) to re-engage with Venezuelan crude suppliers. Here’s an in-depth analysis of the current situation and its implications for India’s oil import dynamics.
Resurgence of India’s Oil Imports from Venezuela
Reliance Industries Takes the Lead
Reliance Industries (RIL) has taken the initiative by booking three tankers scheduled to load oil from Venezuela in December and January. This move comes after the US lifted sanctions on Venezuela, allowing oil exports without limitations for a six-month period. The decision by RIL signifies a revival of trade relations between India and Venezuela, showcasing the economic impact of geopolitical developments.
Historical Context of Oil Imports from Venezuela
India, particularly private sector refiners like RIL and Nayara Energy, was a regular buyer of Venezuelan crude before the imposition of US sanctions in 2019. The sanctions led to a complete halt in oil imports from Venezuela. The last recorded import of Venezuelan crude by India was in November 2020. In 2019, Venezuela was the fifth-largest supplier of oil to India, contributing nearly 16 million tonnes of crude to Indian refiners.
Why Venezuela Oil is Banned?
The United States has imposed tough sanctions on Venezuela’s oil industry to put pressure on President Nicolás Maduro to step down. Oil dominates Venezuela’s economy, accounting for almost all of its export earnings.
Its biggest customers have been the US, followed by India and China. But over the past decade, oil production has collapsed and the country is in a deep economic crisis.
Venezuela Oil Reserves
Venezuela, possessing the world’s largest proved oil reserves at 304 billion barrels, surpassing Saudi Arabia, faces a paradox as one of the top oil-producing nations, according to one report in 2022. Despite its abundant reserves, Venezuela’s oil production has sharply declined by over 75% in the past decade, ranking it at #25 globally with 605,000 barrels per day (BPD). The heavy crude oil from Venezuela is highly valued by U.S. refiners. However, the nation’s oil industry’s downturn can be attributed to multiple sanctions imposed by various countries, including the U.S., with the Trump Administration enforcing sanctions on Venezuela’s oil sector in 2019.
List of countries by oil imports
List of countries by oil import is precisely given by Wikipedia, you can read on the link: Wiki
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