India May Shift Crude Oil Purchases to the US and Venezuela

US President Trump announced on February 2nd that the US and India had reached an agreement on India ceasing its purchases of Russian crude oil. India will reportedly instead purchase crude oil from the US and Venezuela. In return, the US is prepared to remove the additional tariffs imposed on India as part of sanctions against Russia.

Trump posted on social media that he discussed numerous matters with Indian Prime Minister Modi on the morning of February 2nd, including trade and ending the Russia-Ukraine war. Trump wrote, “He has agreed to stop buying Russian crude oil and significantly increase purchases from the United States. It is also possible that purchases will be made from Venezuela.”

Trump announced on February 2nd that he would reduce the retaliatory tariffs imposed on India from 25% to 18%. According to the Washington Post, the US will also remove the 25% additional tariffs that will be implemented in August 2025. This would likely reduce the tariff burden on Indian products from a total of 50% to 18%.

Trump stated that the tariff reduction would be implemented “immediately,” but did not specify a timeframe. According to him, Modi also pledged to lower tariffs on US products and purchase $500 billion worth of US energy and agricultural products.

India had previously increased its purchases of Russian crude oil, whose prices had fallen due to US and European sanctions, providing financial support for Russia’s ongoing offensive in Ukraine. Trump, attempting to mediate the Russia-Ukraine war, imposed additional tariffs on India to force it to stop buying Russian crude.

According to statistics from the Finnish think tank, the Center for Energy and Clean Air Studies, from December 2022 to April 2025, China accounted for 47% of Russia’s crude oil exports, while India accounted for 38%.

With China, Russia’s largest crude oil importer, in a state of “temporary truce” in the US-China trade war, the US is unlikely to include it in a second round of tariffs. Therefore, the US has turned its attention to India, which is crucial in containing China in the Indo-Pacific region.

The US attitude had previously shown signs of change. From around the end of 2025, in key areas of economic security, the US began to focus on building cooperative relationships with allies rather than using tariffs to create confrontation.

However, it remains unclear when India, reliant on low-priced Russian crude oil, will cease imports. While Trump has stated he will divert Venezuelan crude oil, which is striving to rebuild its oil industry under US leadership, to India, the extent of its production capacity remains unknown.

If India stops purchasing Russian crude oil, it will negatively impact Russia’s finances. However, if other countries purchase Russian crude oil, the impact will be relatively limited. Closing loopholes such as the “shadow fleet” of tankers secretly transporting crude oil is also a major challenge. Russian Presidential Press Secretary Peskov stated on the 3rd, “Regarding this matter, we have not received any information from the Indian side.”

On the other hand, if India stops importing Russian crude oil under US pressure, its citizens will perceive it as a significant concession to the US. This is also why India previously maintained a “resolute resistance” despite the US raising tariffs to 50%.

Reports indicate that Russian crude oil accounts for one-third of India’s total crude oil imports. If no alternative source of supply can be found, domestic prices in India will inevitably rise sharply. Therefore, Venezuela has emerged as a potential “compromise” between the US and India.

Following the US intensification of sanctions against the Maduro regime in Venezuela in 2019, the Indian conglomerate Reliance Industries is believed to have significantly reduced its crude oil imports from Venezuela. In late January 2026, after the US detained President Maduro, Modi spoke with Venezuelan acting president Rodriguez, and the two sides reached an agreement on energy cooperation.

Approximately 40% of the weapons held by the Indian military are produced by Russia. For national security reasons, India, unwilling to offend Russia, took preemptive action.

Taking advantage of President Putin’s visit to India in December 2025, the two countries began consultations on jointly producing Russia’s latest Su-57 fighter jet in India. Sources indicated that “technical negotiations have entered the final stage.” This reflects India’s intention to limit the deterioration of bilateral relations with Russia through the purchase of fighter jets and joint production.