The energy sector of India is now set to benefit from the US licence granted to India’s Oil and Natural Gas Corporation (ONGC) to resume its oil activities in Venezuela through its foreign subsidiary, ONGC Videsh Ltd (OVL). This is a big boost for the Indian company since it was previously hampered by a sanction issue.
It is crucial to note that Venezuela is one of the countries endowed with huge oil reserves in the world while India continues to rely heavily on imported oil to fuel its energy needs. It means that for ONGC, the US licence can offer a chance to generate revenues from the country.
The authorization, issued by the Office of Foreign Assets Control of the US Department of the Treasury (OFAC), which allows ONGC Videsh to get back on track with their Venezuelan operations is quite important considering the earlier sanctions by the US that restricted commercial dealings in oil assets of Venezuela.
The most recent approval will essentially provide more freedom to the OVL to participate in their Venezuelan projects along with conducting production activities.
This step is being taken amid the United States’ relaxation of the restrictions in some areas of Venezuela’s energy sector. This move provides international oil companies an opportunity to conduct business in Venezuela. Certain transactions related to oil and gas operations in Venezuela were authorized by the rules that were introduced earlier this year.
ONGC’s relationship with Venezuela is not new at all. With the help of ONGC Videsh, there have been significant investments in Venezuela’s oil projects, like San Cristóbal project and the Carabobo-1 project in the Orinoco Belt.
According to the India Embassy report for 2025 business in Caracas, the OVL had a 40% participating interest in the San Cristóbal project and 11% in the Carabobo-1 project. The production from the Venezuelan assets of OVL was roughly estimated at 12,000-15,000 barrels a day, whereas the company was trying to recover over $600 million dividends.
This means that this particular license from the US does not make India’s entry into Venezuela’s oil sector at all. It makes way for an already existing Indian company to be more productive and commercially useful.
One of the biggest financial implications is the possibility of recovering hundreds of millions of dollars in dividends that have remained stuck because of restrictions surrounding Venezuela.
Reports put the potential recovery at around $600 million.
For ONGC Videsh, recovering these funds would strengthen the financial case for remaining invested in Venezuela. More importantly, greater operational freedom could allow the company to increase production and generate additional returns from assets in which India has already committed substantial capital.
This makes the licence both an energy-security development and a financial opportunity for India’s state-owned energy sector.
Yes, but the effect should not be overstated.
India requires much more crude oil than it produces domestically; hence foreign energy resources are strategically significant. “ONGC Videsh Limited” itself refers to its operations abroad as an integral part of India’s foreign energy policy and currently has assets in a number of countries.
New Venezuelan production will help India diversify its sources of crude. But the actual amount of crude produced by ONGC’s Venezuelan operations is relatively modest, compared to India’s total crude consumption.