Indian state refiners Indian Oil Corp and Hindustan Petroleum Corp have purchased a combined 2 million barrels of Merey crude from Venezuela, with delivery scheduled for the second half of April, according to a Reuters report.
A Very Large Crude Carrier (VLCC) will transport the crude oil, which is being sold by Trafigura, according to sources quoted in the report.
The shipment is slated to arrive on India’s east coast, with Indian Oil Corporation (IOC) receiving approximately 1.5 million barrels and Hindustan Petroleum Corporation Limited (HPCL) receiving about 500,000 barrels.
Diversifying away from Russian oil
Indian refiners are actively diversifying their crude oil imports, a strategic move aimed at reducing their reliance on Russian supply.
This shift is primarily driven by New Delhi’s efforts to facilitate a trade agreement with Washington.
By avoiding Russian oil, which had become a significant, low-cost source, Indian state-owned and private refiners are signalling their commitment to strengthening commercial ties with the United States and aligning with broader geopolitical objectives.
This diversification strategy involves securing supplies from various alternative global sources, ensuring energy security while supporting the broader diplomatic push for a favorable trade deal.
HPCL has made its first purchase of Venezuelan oil in two years. This follows a previous purchase of Venezuelan oil in 2024 by the country’s leading refiner, IOC, according to the report.
HPCL is actively pursuing Venezuelan heavy crude oil for its upgraded 300,000-barrels-per-day refinery in Visakhapatnam, Andhra Pradesh.
This move, announced in January, capitalises on the refinery’s recent ability to process heavier crude grades.
Market activity
Historically, another major Indian refiner, IOC, has experience processing Venezuela’s Merey crude, specifically at its Paradip refinery in Odisha.
This indicated a growing interest and established capacity within India’s refining sector to handle Venezuelan heavy oil, likely in an effort to diversify sourcing and optimise operations based on the new processing capabilities.
Merey’s price is benchmarked against the Dubai standard and, according to a trade source, is comparable to the rates at which Reliance Industries acquired Venezuelan oil from the trader Vitol.
Reliance Industries bought about 2 million barrels of Venezuelan crude last week, according to a Bloomberg report.
Reliance’s acquisition is the first instance of India purchasing Venezuelan oil since the US assumed control over Venezuela’s oil sales at the beginning of last month.
Reliance Industries’ last purchase of crude oil from Venezuela occurred in mid-2025, facilitated by a specific US Administration waiver that had been in effect since mid-2024.
The company stated last month that it would contemplate resuming purchases of Venezuelan crude, provided sales are authorised for non-US entities.
Trade deal framework
Prior to US sanctions targeting Russia’s major producers, Rosneft and Lukoil, Reliance Industries was the largest purchaser of Russian crude oil.
Reliance, an Indian refiner, had a long-term agreement with Rosneft and was importing over 500,000 barrels per day until it ceased all Rosneft purchases following the imposition of sanctions.
In a related development, Mangalore Refinery and Petrochemicals Limited (MRPL), an Indian state-run company, is also considering the potential acquisition of Venezuelan crude after discontinuing its imports of Russian oil.
Vitol and Trafigura, two of the world’s leading independent traders, are now marketing Venezuelan crude to buyers in India and China.
These firms, recently enlisted by the US to help sell Venezuela’s oil, are offering the crude for delivery in March and April.
US Gulf Coast oil refiners are facing difficulties processing a quick surge in Venezuelan shipments, resulting in some cargo remaining unsold, according to information from traders and shipping data.
Meanwhile, the US and India have established a framework for a trade deal, signaling progress toward an agreement that is expected to be finalized by March.
This pact aims to reduce tariffs and enhance economic collaboration between the two nations.
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