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Indian imports of crude from Venezuela reach minimum of more than five years

Venezuela's crude production plummeted last year to its lowest level in decades.


Reuters 13 Mar 2018, 07:46 PM India, Venezuela, Rb
Indian imports of crude from Venezuela reach minimum of more than five years
  • Indian oil imports from Venezuela fell to their lowest levels in more than five years. (Image credit: Youtube)

Indian oil imports from Venezuela fell to their lowest levels in more than five years, industrial and shipping data showed, as a severe economic and political crisis increasingly affects production. of oil from the South American member of OPEC.

Indian purchases of Venezuelan oil averaged about 300,000 barrels per day (bpd) between November 2017 and February 2018, a drop close to 20 per cent from the same period a year earlier and the lowest level since 2012, according to the data from shipping and industrial sources.

The sources refused to be identified because they are not authorized to speak with the press.

Venezuela's crude production plummeted last year to its lowest level in decades, in a context of galloping inflation, lack of foreign currency and crippling recession.

The average of five years of Venezuelan oil sales to India is around 440,000 bpd, according to the data. Supplies to the Asian country are still dominated by members of the Middle East of the Organization of Petroleum Exporting Countries, especially Iraq and Saudi Arabia.

The key to the decline in Venezuelan shipments to India are the provision obligations to other countries that - in the midst of the fall in production - leave less cargo available to Caracas for sale to other buyers.

"Venezuela is obliged to supply barrels to China and Russia to pay debts, so there is not much left for others, mainly India," said Ehsan Ul-Haq, director of crude and refined products at the Resource Economist consultancy.

The drastic declines in Venezuelan shipments to India mark a change in trend. As of May 2012, they had increased, after Iranian supplies were affected by Western sanctions against Tehran's nuclear program. However, New Delhi again boosted purchases from Iran after the lifting of sanctions in 2016.