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The United States has pressed India to stop buying Venezuelan crude oil as a means of accelerating President Nicolas Maduro’s removal from office, which Washington has made its top priority in Latin America recently.
“We say you should not be helping this regime. You should be on the side of the Venezuelan people,” the U.S. envoy for Venezuela Elliott Abrams told Reuters in an interview.
Washington has been quick to throw its support behind the president of the National Assembly in Caracas, Juan Guaido, who declared himself interim president in late January and called for new, transparent elections.
India is not the only one that the Trump administration has been pressing to cut off oil ties with Venezuela as a way of cutting the Maduro government’s access to money, but it may be the most important yet.
India, Reuters recalls, is the second-largest buyer of Venezuelan crude after the United States itself, and that stream has dried up as a new account was set up in the U.S. to process payments for Venezuelan crude oil imports into the country and make the money available to the Guaido camp.
Yet India may be a lot less willing to comply with what Washington asks it to do: the United States now wants India to stop importing Iranian oil and just last week President Donald Trump signaled a new trade war might be in the making, this time with India.
“I am taking this step because, after intensive engagement between the United States and the Government of India, I have determined that India has not assured the United States that it will provide equitable and reasonable access to the markets of India,” Trump wrote in a letter to the Speaker of the House of Representatives and President of the Senate.
Meanwhile, India is negotiating a sanction waiver extension for Iran, so it can continue importing Iranian crude at the rate it is doing currently, 300,000 bpd. This is much less than what it used to import from Iran before the U.S. sanctions snapped back last November but is, apparently, indispensable.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.