In exchange for lowering its customs duties on Indian products, Washington demanded that New Delhi buy less Russian oil. The United States is in “active negotiation” regarding the sale of Venezuelan oil to India, in order to help New Delhi diversify its sources of crude oil supply, said American envoy Sergio Gor on Friday, February 20. The United States made diversification away from Russian oil a condition for reducing tariffs on Indian imports, the third largest importer and consumer of oil globally. “The Department of Energy is in discussions with the (Indian) Ministry of Energy here, and we hope to have news on this very soon,” said Sergio Gor.
Speaking to the press during an event in New Delhi, where India joined the Pax Silica initiative led by the United States to establish a silicon supply chain for high-tech products, Sergio Gor stated, “Regarding oil, there is an agreement […] We have seen India diversify its sources of oil supply. There is a commitment. It is not about India. The United States does not want anyone to buy Russian oil.”
The recent reduction of import tariffs on Indian products by 18% as part of a provisional trade agreement was approved by American President Donald Trump earlier this month. He also lifted a punitive 25% tax after India agreed to stop buying Russian oil, which the United States claims helps fund Russia’s invasion of Ukraine. Trump stated that India would purchase more oil from the United States and potentially from Venezuela.
An official notification for the provisional trade agreement with India, which is expected to take effect in April, is set to be published by the United States this month. Indian Commerce Minister Piyush Goyal declared, “A definitive trade agreement with India will be signed very soon, as ‘a few adjustments’ are necessary.” The United States and its allies imposed sanctions on the Russian energy sector following the invasion of Ukraine in 2022. In response, India became the top buyer of Russian crude oil transported by sea, which it purchased at competitive prices, much to the dismay of Western countries.
Last month, Reuters reported that the United States had offered to sell Venezuelan oil to India to replace Russian oil imports. Licenses were granted to commercial companies Vitol and Trafigura to market and sell millions of barrels of Venezuelan oil after capturing Venezuelan President Nicolas Maduro last month and concluding a supply agreement with interim President Delcy Rodriguez. Indian Oil Corp, Hindustan Petroleum, Bharat Petroleum, as well as private refiners Reliance Industries and HPCL-Mittal Energy, have ordered Venezuelan oil, according to Reuters.
