India’s biggest private oil refiner Reliance Industries has capped crude imports from sanction-hit Venezuela, the company said Thursday, following pressure from the United States.
The energy-to-telecoms conglomerate has also stopped exporting diluents to the crisis-hit South American country, it told AFP.
The announcements come after US Secretary of State Mike Pompeo asked India to halt all crude imports from Nicolas Maduro’s regime, which the United States does not recognise.
“Our US subsidiary has completely stopped all business with Venezuela’s state-owned oil company, PdVSA, and its global parent has not increased crude purchases,” Reliance said in an emailed statement.
“Reliance has halted all supply of diluent to PdVSA and will not resume such sales until sanctions are lifted,” added the company, which is owned by India’s richest man Mukesh Ambani.
Venezuela — a once-rich oil-producing nation — is in the grip of an economic and political crisis and analysts said ending diluent exports would hamper Venezuela’s output.
“Venezuelan oil is thick and needs these raw materials for processing crude,” PetroWatch editor Madhu Nainan told AFP.
Venezuela is reeling from an unprecedented, week-long nationwide blackout and inflation is projected to reach 10 million percent this year, according to the IMF.
The country’s infrastructure has degraded over years because of a lack of investment, a significant brain drain, and the government’s practice of putting the military in charge of key civilian facilities and companies.
The situation has worsened with successive rounds of US sanctions against Maduro’s government, including steps that have severely curbed its oil exports.
India became the top importer of crude from Venezuela in February after US President Donald Trump issued a de facto ban on imports.
The US and European Union recognises opposition leader Juan Guaido as Venezuela’s interim president.
On Tuesday, Pompeo asked India to stop buying crude from Venezuela, so as not to provide an “economic lifeline” to Maduro’s regime.
The following day, New Delhi warned oil companies that they faced “undisclosed consequences” if they continued to buy Venezuelan oil.
“We will continue a constructive dialogue with the US government to ensure Reliance remains in compliance,” the conglomerate, which operates the world’s biggest refining complex, added in its statement.