Oil has long been a strategic tool of US foreign policy, shaping sanctions, alliances and power politics.
Washington’s moves in Venezuela and pressure on India reflect a dual strategy—reshaping oil supply while influencing where major importers source their energy.
As energy dependence becomes a geopolitical vulnerability, the approach raises questions for countries like India about strategic autonomy in an increasingly politicised global oil market.
What is the connection between Putin’s war in Ukraine, and the events that unfolded in Venezuela this week? If you feel ‘none’, think again. The deposition of Nicholas Maduro is likely motivated by a multitude of reasons, but two of the most important ones are the US’ need to get greater control over the global petroleum market, and the need to check the rising clout of China in the western hemisphere, the US’ traditional ‘sphere of influence’.
First, the Russian connection. Trump came to power promising to end the war in Ukraine in “24 hours”. However, nearly a year after he won the election, the war is no closer to ending than when he was delivering stump speeches on his campaign trail in 2024.
1 January 2026
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Despite the Trump administration’s aggressive use of tariffs and efforts at sanctioning Russia, Moscow has shown greater economic resilience than Washington anticipated, aided by continued energy purchases from China and India. Efforts to squeeze Moscow’s oil revenues through secondary sanctions on firms such as Rosneft and Lukoil have been blunted by sustained Asian demand and Western concerns that sharply curbing Russian supply could trigger an uncomfortably high spike in global oil prices, analysts said. The result has been a strategic dilemma for the US, as pressure on Russian energy exports risks destabilising oil markets and pushing prices higher.
As 2025 drew to a close, Trump seems to have finally realized that he does not have the kind of control over the global oil market as he envisaged. Coupled with increasing wariness over China’s growing influence in Latin America, Trump’s attention naturally fell on Venezuela—a stone to kill two birds.
“US actions reflect an effort to shape the global energy market — not only by reviving stalled oil resources in countries such as Venezuela, but also by positioning the US as a viable exporter with greater influence over the availability and type of oil,” Dr. Swaran Singh, professor at School of International Studies, Jawaharlal Nehru University said. Singh also notes that Venezuela’s importance is further underscored by China’s long-standing involvement in its oil sector, making control over future production relevant not just to Russian sanctions but also to broader strategic competition involving Washington.
Crude Calculations
Venezuela produces heavy crude oil needed for diesel fuel, which is in short supply around the world owing to sanctions, and because US’ lighter crude oil can’t replace it. Gearing up production in Venezuela could make it easier to exert pressure on Russia as European markets and others could now pivot to Venezuela for heavy oil and diesel.
By reshaping supply through Venezuela, Washington would gain greater flexibility in influencing global energy flows — a strategy that complements its efforts to pressure major importers to realign their oil purchases.
Indeed, Trump made no efforts to hide the central role oil will play in the way Washington will direct events in Venezuela after the ‘snatch and grab’ of Maduro. Trump stated that the Venezuelan oil industry has been “a total bust” for a long time. He promised to take control of Venezuela’s oil industry with America’s biggest oil companies spending “billions of dollars” to fix the “broken structure.” Under Trump’s new plan, the US oil companies will partner with state oil firms PDVSA, to develop and produce crude in exchange for share of the profits.
Indeed, oil has long underpinned US global influence, serving both geopolitical and monetary purposes. Since the 1970s, the dollar’s role in oil trade has helped stabilise global demand for the US currency, embedding energy markets within Washington’s broader strategic architecture.
The use of oil as a strategic lever in US foreign policy has deep historical roots. In 1941, Washington imposed an oil embargo on Japan, a move widely seen as a key factor preceding the Pacific War. Decades later, the US institutionalised its energy dominance through the 1974 petrodollar agreement, negotiated under then Secretary of State Henry Kissinger, which anchored global oil trade to the US dollar and reinforced American financial influence.
Since then, countries that have sought to operate outside this framework or defy US sanctions-- including Iran after the 1979 Islamic Revolution, Iraq following the Gulf War, and Libya in the 2010s-- have often faced varying degrees of political, economic or military pressure.
“Over time, Washington has consistently used sanctions, military pressure, and financial restrictions to deter producers and importers from bypassing this system,” Ajay Srivastava, former trade official and founder of Global Trade and Research Initiative, said.
India’s Role
Perhaps unintentionally, India’s own actions may have contributed to the factors leading to the attack on Maduro. Since the Ukraine war, India has emerged as one of the largest buyers of Russian crude, purchasing discounted oil to meet its energy needs - a choice that has frustrated Trump’s attempts to turn off the supply of petro dollars that Trump feels is fueling the war.
Washington has repeatedly urged New Delhi to curb these imports, framing the pressure around geopolitics and trade. Trump has openly said he wants India to buy more oil and gas from the US, positioning energy trade as part of a broader strategic realignment.
However, India has defended its position, arguing that there simply isn’t enough supply of crude in the world to replace Russian production, which currently accounts for 11% of the global output. It also pointed out that the Biden administration was cognizant of this fact, and had given an informal assent to continue importing Russian oil, albeit at discounted prices. It also pointed out that even Europe continued to buy gas from Russia, besides output from Indian refineries running on Russian crude. Moreover, the public nature of the spat forced India to dig in, citing broader reasons such as energy security and strategic autonomy.
Eventually, Trump seems to have realized that to truly put pressure on Putin, there has to be a ramp up in the production of crude oil, and what better than the owner of the world’s largest petroleum reserves—Venezuela—to be moved into position. This is especially pertinent, given that Venezuela’s production has been declining every year due to poor maintenance of the production infrastructure to currently just around 1% of the total global output.
Read together, the developments in Venezuela and India do not appear as isolated episodes, but as two ends of the same strategy. On the one hand, Trump is ensuring greater flexibility on the supply side by ramping up production in Venezuela, while also seeking greater control over where countries such as India and China get their energy from.
Implications for India
While India may have inadvertently contributed to the events over the past days, the events also hold important lessons for India’s strategic interests and long-term energy security.
When oil is deployed as a geopolitical lever rather than treated as a traded commodity, energy dependence can translate into political vulnerability. For import-heavy economies such as India, this raises difficult questions about economic autonomy, strategic alignment and the limits of sovereign decision-making in an increasingly politicised energy market.
Whether this approach reshapes global energy politics will depend on how major importers respond — by deepening diversification or resisting efforts to turn energy trade into an instrument of geoeconomic coercion.
