Will Petrol and Diesel Prices Rise in India? How Venezuela’s Earthquake Could Impact Fuel Costs

New Delhi: Amidst the ongoing tension in West Asia, India had in recent months increased imports from Venezuela to meet its crude oil needs. However, now the massive earthquake that hit the South American country has posed a new challenge to this strategy. Following the earthquake, power supply has been disrupted in many areas, road and transport networks have been affected, while emergency restrictions have been imposed at some major ports. In such a situation, the possibility of delay in transportation of crude oil has increased, which may also affect Indian refineries.

Did Venezuela become a big support for India after the Middle East crisis?

Indian refineries had intensified their search for alternative sources after tensions in the Strait of Hormuz and uncertainty over sea routes increased. During this period, the import of crude oil from Venezuela increased rapidly and within a few months it became one of the major suppliers to India. A significant increase in imports from Venezuela was recorded during April and May, which helped balance India's energy supply.

What is the biggest concern after the earthquake?

Experts say that even though there may be limited damage to oil production centers, the impact of the earthquake may be more visible on logistics. Ship movements may be affected due to power outages in many areas, damaged roads and limited operations at ports. If the ships are not loaded on time, there may be a delay in the crude oil consignment reaching India.

Will the prices of petrol and diesel be affected in India?

At present, it is not expected to have a direct impact on the prices of petrol and diesel. However, if there are persistent shipping delays, freight costs may increase. Imports can be expensive due to long wait times for ships, rerouting and additional insurance costs. If this situation continues for a long time, there may be additional financial pressure on the refineries.

Why has the challenge increased before insurance and shipping companies?

Until now, geopolitical circumstances and international sanctions were the main concerns regarding maritime risks associated with Venezuela. But after the earthquake, the risk of natural disasters has also been added to it. This could put additional pressure on ships' insurance premiums, freight costs and shipping operations. Experts believe that in future this sea route will be assessed keeping in mind not only political but also natural risks.

Can India's investment also be affected?

Indian government company ONGC Videsh has invested in Venezuelan oil projects. If production or exports are affected for a long time due to earthquake, these projects may also be affected. This is likely to increase pressure on India's energy interests as well as the ongoing investment and operational activities there.

What will be the impact on the relations between India and Venezuela?

Recently, there were discussions between Prime Minister Narendra Modi and Venezuela's acting President Delsey Rodriguez to increase cooperation in energy, mining, critical minerals, pharmaceuticals and automobile sectors. Talks were progressing towards strengthening the economic partnership between the two countries. However, after the latest natural disaster, the pace of these plans may be affected for some time. Now everyone's eyes are on how quickly Venezuela can bring its ports, transportation system and oil export system back to normal.