Will US-Venezuela fallout lead to rise in petrol, diesel prices?:Experts say Brent crude can rise to $65 per barrel, warning fall in rupee’s value can force oil companies to hike fuel prices in India

The US-Venezuela fallout and consequent announcement by the US President Donald Trump regarding potential investment by America’s oil companies in Venezuela’s oil reserves, will not lead to rise in petrol and diesel prices in India, spontaneously, says experts. Impact of US oil companies’ investment in Venezuela’s oil reserves on global crude oil prices: According to the commodity expert, Ajay Kedia, founder, Kedia Advisory, if global crude oil prices shoot up and given the fact that the Indian currency rupee has already fallen by 5% against US dollars in 2025, and if the local currency continues to face value erosion leading to inflationary imports bill for the government of India, then, the OMCs may be forced to hike mobility fuel rates in India. Even a small increase in global crude rates could make imports expensive in rupee terms. Combination of geo-political tensions, rupee weakness will definitely raise fuel price burden on OMCs. – Ajay Kedia, founder, Kedia Advisory Impact of US-Venezuelan fallout on petrol and diesel prices in India? Kedia thinks there are chances of upward revision in petrol and diesel prices in India due to global scenarios shaping up recently. According to him, following contributory factors may force OMCs to raise prices: 1. Rise in global crude oil prices 2. Erosion in rupee’s value 3. Consequent inflation in GoI’s crude oil import bill India meets 80% of crude oil needs via imports. China is one of the biggest buyer of Venezuelan oil, says Kedia. Global crude rates may rise but only on sentiment. What has been the impact of Trump’s announcement of investment by US oil companies in Venezuela? Both Shrivastava and Kedia are of the view that the US President Donald Trump’s announcement of investment by the US oil companies in Venezuela has only influenced crude oil rates marginally because of over supply and lower share of Venezuelan oil in the global supply chain. The recent U.S. action and President Trump’s announcement on allowing American companies to invest in Venezuelan oil assets have caused only limited volatility in global crude prices. -Ajay Shrivastava, founder, GTRI Shrivastava adds that markets recognise that Venezuela is currently a marginal supplier, and oil prices are being driven far more by global demand conditions, OPEC+ output decisions, US shale production, and macroeconomic trends than by Venezuela’s short-term political upheaval. Ajay Kedia says in 2025, crude prices traded with negative bias. Rates plunged 15% in that year due to oversupply. What is the current state of supply of crude at global level? According to Kedia, the current condition of supply of crude oil at the global level is “quite good.” How’s supply going to be in future? Kedia expects abundant supply of crude oil at least in first half of 2026. The commodity expert adds that the production by the likes of US, Brazil, Gyana is going to be in abundance. Can Brent crude prices rise from here? According to Kedia, the upside in Brent prices will be capped. Albeit, rates might go up to $65 per barrel. Venezuela has world’s largest oil reserves Venezuela holds the world’s largest proven crude oil reserves—about 300 billion barrels, nearly 18% of the global total—but it produces less than one million barrels per day, or under 1% of world supply. How petrol diesel prices in India are determined? Fuel prices in India are calculated under a market-linked system based on global crude prices and the rupee-dollar exchange rate, but taxes play a decisive role in the final pump price. Central excise and state VAT together account for 40–70% of retail fuel prices, giving governments significant control. Price of Brent Crude on Tuesday Brent crude prices have dropped 16% in last one year. The benchmark crude currently trades at $62 per barrel. When petrol diesel prices were last slashed in India? The OMCs had last slashed fuel rates by ₹2 per litre in March 2024. Since then, petrol in the national capital costs ₹94.72 per litre and diesel comes at ₹87.62 per litre. At the time, Brent crude was available at $75 per barrel. Since then, the benchmark crude oil has become cheaper by $13 per unit. While, mobility fuel has not become cheaper by a single penny during the same period in the country. This is despite the fact that petrol and diesel rates are linked with international crude oil prices. ​