Breaking News: Trump’s fresh 25% tariff threat linked to Venezuelan oil. Trouble for India?….Read More

US President Donald Trump’s “secondary tariff” on countries buying Venezuelan oil will come into effect on April 2, the same day when reciprocal tariffs on US’s trading partners, including India, will be imposed.

In a move that could stir up the global energy market, US President Donald Trump on Monday said that countries that buy gas and oil from Venezuela would pay 25 per cent tariffs on any trades made with the United States. The move could trigger higher levies on goods from India and China, which are Venezuela’s two biggest oil players.

Trump said the “secondary tariff” will come into effect on April 2, the same day when reciprocal tariffs on the US trading partners, including India, are set to be imposed unless the US President winds down.

The move is a part of a broader strategy by the Trump administration to pressure countries that engage in trade with Venezuela, which Washington accuses of fostering hostility towards the US and of sending violent gang members into the country. But, will India face the brunt of a “secondary tariff” as it faces a retaliatory levies threat from Trump?

According to multiple news reports, India emerged as the top buyer of Venezuelan crude oil for two consecutive months in December 2023 and January 2024 after sanctions imposed against the dictatorship regime of Nicolas Maduro on Caracas’s oil imports eased.

Last year, Venezuela exported 6,60,000 barrels of crude oil a day, with India, China and Spain emerging as top buyers, according to The Financial Times.

Trump’s fresh tariff threat on countries buying Venezuelan oil could stoke huge turmoil in the energy market, as the White House has been seeking to steer clear to avoid a spike in petrol prices for American motorists due to supply disruption.

India has been actively seeking to diversify its oil imports, with Venezuela being one of the countries it has been considering for increased purchases. In 2024, India imported approximately 22 million barrels of Venezuelan oil in 2024, constituting about 1.5 per cent of its total crude oil purchases.
In his first term as well, Trump put strict sanctions on Venezuela and selected officials who could seek to cut US imports of Venezuelan oil.

Later, the Joe Biden administration gave incentives to encourage a presidential election in Venezuela, but after basic conditions for fair voting were not secured, it ended a broad licence for the energy sector, instead issuing individual licences to exporters.

Notably, Reliance Industries, India’s largest private refiner, secured US approval to import Venezuelan oil in 2023, thereby accounting for a significant portion of New Delhi’s Venezuelan oil imports after the sanctions were temporarily lifted, a news agency Reuters report said last year.

Before US oil sanctions were first imposed on Venezuela in 2019, Reliance was the second-largest individual buyer of Venezuelan crude after China’s CNPC

The Oil and Natural Gas Corporation had also sought a waiver from the US Office of Foreign Assets Control to lift crude oil sanctions from Venezuela, an industry source was quoted by news agency Reuters.