Trump's Venezuela Play: A New Oil Route for India Bypassing Iran

U.S. President Donald Trump announced that India will buy oil from Venezuela instead of Iran. This move is part of a broader strategy to reshape global energy markets. Speaking to reporters aboard Air Force One, Trump stated, "We've already established that agreement, the idea of the agreement," adding that China is invited to negotiate a deal with the U.S. for Venezuelan oil.

The announcement follows the capture of Venezuelan President Nicolas Maduro on January 3. Trump signed an executive order earlier this month to safeguard Venezuelan oil revenues in U.S. Treasury accounts. Energy Secretary Chris Wright noted that the U.S. is now receiving about $45 per barrel for Venezuelan oil, up from roughly $31 before Maduro's capture.

India is cutting Russian oil imports due to U.S. tariffs. According to Reuters sources, India's Russian crude intake, which was around 1.2 million barrels per day in January, is expected to drop to 1 million bpd in February, 800,000 bpd in March, and further to 500,000-600,000 bpd. Though India hasn't imported Iranian oil since 2019, it had $1.68 billion in trade with Tehran in 2024-25.

Venezuela-India ties are warming. Acting President Delcy Rodriguez spoke with Prime Minister Narendra Modi recently, agreeing on "a common action plan to restart relations in 2026" in energy, trade, and investment. India's largest private refiner, Reliance Industries, was a regular buyer of Venezuelan crude before sanctions.

This aligns with U.S. efforts to curb Russian oil revenues funding the Ukraine war. India diversifies its energy security with Venezuelan oil, while the U.S. steers global oil flows in its favor.