Rising US naval activity in the southern Caribbean has escalated tensions with Venezuela,
raising concerns over the impact on India’s oil imports from the Latin American nation,
according to a recent report.
For India, Venezuela represents more than a distant geopolitical crisis; it highlights the vulnerabilities of relying on foreign policy cycles for critical energy supplies, writes energy expert Yash Malik in ‘India Narrative’.
India had benefited from importing heavy crude from Venezuela after the US eased sanctions in 2024. However, the reimposition of restrictions this year has led to dwindling supplies, demonstrating how quickly external politics can undermine India’s energy strategy.
ONGC Videsh, which holds stakes worth hundreds of millions in Venezuelan oilfields, now faces challenges in repatriating dividends and navigating US licensing regimes. Each tightening of sanctions has translated into blocked cash flows and frozen assets.
The repercussions extend beyond oil. Pharmaceutical exports to Venezuela, valued at $111 million in 2024, are also at risk due to payment bottlenecks and compliance challenges. When sanctions disrupt financial channels, even essential supplies are affected. The report cites the 2016 “oil-for-drugs” model as a lesson in resilience: linking trade to tangible assets, reducing dependence on Western channels, and insulating critical sectors from extraterritorial sanctions.
In a world where sanctions are increasingly used as tools of statecraft, reliance on external regulatory goodwill is a strategic liability, the article notes. India’s energy strategy, from Russian crude and Iranian partnerships to Venezuelan ventures, must prioritise supply diversification, legal and financial mechanisms to circumvent unilateral restrictions, and the ability to pursue an independent energy policy.
“New Delhi must treat Venezuela not as a diplomatic footnote but as a warning. Every blocked shipment or frozen dividend underscores the cost of timidity. India cannot let foreign capital determine when it may access its own energy or recover its own investments,” the article concludes.
