Indian strategic pivot to Venezuelan oil, as Delcy Rodriguez visits New Delhi

Venezuelan acting President Delcy Rodrigues will visit India for the first time since taking office as the President of Venezuela. She has had a long-standing diplomatic relationship with New Delhi and has travelled to the country multiple times in her previous governmental roles. This is her sixth visit to India. Delcy Rodriguez's visit to India will last 5 days from June 3 to June 7, and will hold talks with Indian Prime Minister Narendra Modi, Indian Foreign Ministry spokesperson Randhir Jaiswal said in a press briefing on Tuesday.

Venezuelan oil to fulfil Indian energy needs

The visit comes at a time when India, the third largest importer of crude oil, has faced a supply crunch due to the US-Israeli war on Iran. Venezuela has emerged as India's fifth-largest source of crude oil imports in May, supplying over 266,000 barrels a day or roughly 5.3 per cent of total crude imports, according to maritime analytics firm Kpler. While the June arrival is expected to rise over 300,000 barrels a day. India's Reliance Industries has emerged as one of the three largest buyers of Venezuelan ​crude, along with Chevron and Vitol. Indian buyers previously stopped purchasing Venezuelan crude following US sanctions. Now India again resumed purchases in February after more than 10 months, specifically through US-based Chevron and Vitol.

"As part of the programme, the Venezuelan delegation will visit several sites connected with energy, pharmaceuticals and auto sectors to gain insights into India’s technological and industrial capabilities and to explore opportunities for collaboration," said MEA in a press briefing.

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India had usually been reliant on Gulf oil

Historicall Indian had been reliant on Gulf oil, with imports from Iraq, Saudi Arabia, the UAE and Kuwait. In 2022, with the outbreak of the Russian war in Ukraine and Western sanctions on Moscow, India started to aggressively purchase Russian Urals. Russia shattered the Gulf monopoly by supplying discounted crude and rose to the top of the Indian supplier, capturing over 35-40 per cent of the Indian market. However, as the war in West Asia started, and the effective closure of Hormuz for nearly 80-days, India's residual reliance on Gulf Oil became problematic. Further, India's dependence on irregular waivers from the US to purchase Russian crude hurt the policy of economic nationalism and price pragmatism. Though India maintained a strategic autonomy, India's pivot towards Venezuela is, on one hand, reclaiming the old market, and on the other hand, maintaining a symbolic relationship and assisting Washington to stabilise crude oil prices. However, purchasing Venezuelan crude poses a logistical challenge as it takes more than 20-25 days for shipments to arrive via the Atlantic basin, compared to the 5-7 days of oil transport through the Persian Gulf, along with additional shipping and insurance costs.