US President Donald Trump has announced that any country buying oil or gas from Venezuela must now pay a 25 percent tariff. He made this announcement on his social media platform, Truth Social. Trump said that Venezuela is adopting a “hostile attitude” toward the US, so this step has been taken. This new tariff may have the biggest impact on India, as recently, India has joined Venezuela’s biggest oil buyers.
Trump said in his statement that Venezuela has become a “threat” to the US. He alleged that Venezuela has deliberately sent criminals and violent gangs to the US. The Trump administration will implement this tariff from April 2, 2025, considering it a “security threat”.
What Will Be The Impact On India?
India bought the most crude oil from Venezuela in December 2023 and January 2024. In January 2024, India imported about 2.54 lakh barrels per day from Venezuela, which was about 50 percent of Venezuela’s total oil exports then. If India continues to buy oil from Venezuela, petrol and diesel may become expensive, posing a rising inflation risk.
Crude Oil Will Become Expensive
Reliance Industries, Indian Oil and HPCL-Mittal Energy buy large quantities of crude oil from Venezuela. The additional 25 percent tariff will make this oil expensive for Indian refineries.
India imports 85 percent of its crude oil requirement and keeps looking for alternative markets to buy cheaper oil. Due to the increased tariff on cheap oil from Venezuela, India may have to consider buying oil from Russia, Iran or other countries.
Impact On Fuel Prices
If India continues to buy oil from Venezuela, the price of petrol and diesel may increase due to the additional 25 percent duty. This will directly affect the general public, which may increase inflation.
Will India Buy Oil From Venezuela Despite The Tariff?
India buys oil from many countries to meet its energy needs. Russia is already giving India crude oil at a discount so that India can buy more oil from Russia instead of Venezuela.
Talk Possible On Tariff
Trade relations between India and America are strong, so India can try to get an exemption from this tariff at the diplomatic level. India will now have to decide whether to continue buying oil from Venezuela by paying the American tariff or increasing oil imports from other countries. The government will try to ensure that there is no direct impact on oil prices and that the import cost is reduced. In the coming weeks, talks can occur between India and America.
