Venezuela oil opening up, Indian firms should invest now: Energy expert

New Delhi: Energy expert Narendra Taneja on Sunday said a potential opening up of Venezuela’s energy sector following recent US actions could create fresh investment opportunities for Indian oil and gas companies, urging a pragmatic approach to secure stakes in the Latin American nation’s vast hydrocarbon assets.

Speaking on the implications of the US President’s announcement on investment and sale of Venezuelan oil, Taneja said Indian firms have long-standing ties with Venezuela’s state-run oil company PDVSA and are well placed to benefit if sanctions ease and the sector opens up.

"Indian companies have known Venezuela for a long time. And in fact, Venezuela's PDVSA, which is their national oil company, has been a major player. If you look at the history of the last 25 years, Indian companies have enjoyed very good relations. We have even gone and invested money there in oil assets," he said.

Taneja noted that PDVSA had been a major supplier of crude oil to India in the past and that certain Indian refineries were specifically designed to process Venezuelan crude efficiently.

"A couple of our refineries are actually designed in such a way that they can process, refine Venezuelan oil very, very economically, which means bringing more benefit to the company and to the importer," he said.

Also Read: Will India bear the brunt of the US strike on Venezuela?

Highlighting Venezuela’s enormous but underutilised energy potential, Taneja said the evolving geopolitical situation could allow Indian companies to expand their footprint across upstream and downstream segments.

"Venezuela's energy sector is going to open up. Would that open an opportunity for countries like India? Now that they can go and buy a stake in oil and gas exploration assets, maybe in producing assets, maybe in downstream assets, maybe in infrastructure, oil infrastructure assets. We should be more pragmatic. So our companies must go and invest now," he added.

Venezuela holds the world’s largest proven oil reserves, estimated at over 300 billion barrels, accounting for around 17 per cent of global reserves, according to OPEC data. Its reserves surpass those of Saudi Arabia, which has about 267 billion barrels, and are more than six times those of the United States. Most of Venezuela’s untapped crude lies in the Orinoco Belt, a vast region in the country’s northeast.

Despite this, crude production has fallen sharply to around one million barrels per day due to prolonged US sanctions and years of underinvestment.

Meanwhile, former Indian Ambassador to Venezuela R. Viswanathan said the US military action targeting Caracas was unlikely to have any major impact on India, citing limited economic exposure.

"No, it will not affect India... We are not dependent on Venezuela for oil. Our trade is very little, and we have some investment by ONGC in their oil fields... So, this is not going to affect India in any big way," Viswanathan told ANI.

He described the reported escalation as unsurprising, recalling similar threats issued by former US President Donald Trump during his earlier tenure, and said recent developments would not materially alter India’s strategic or economic interests.