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Hugo Chavez’s oil diplomacy March 25, 2009

Posted by mytruthaboutoil in Geostrategy, Oil (general).
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hugo-chavezSince his election as president of Venezuela in 1999, Hugo Chavez has used Venezuelas huge oil reserves and production facilities to carry out an aggressive diplomacy towards the United States, based on the countrys strategic resources.

A significant part of oil money is spent on international aid with the clear purpose of countering US influence, especially in South America.

Venezualian State-owned Citgo Petroleum Corp., which is based in Houston (USA), is the official Venezuelan oil dealer in the US. Citgo has been running for years a free heating oil program for poor Americans!!!

This unbelievable aid program, from a developing country to the worlds richest country, distributes free fuel for 200,000 American households in 23 states at the high cost of USD 100 million a year for Chavezs government. But what a brilliant way to get back at American imperialism.

Accounting for nearly 94 percent of exports and half the national budget, oil pays for everything in Chavez socialist politics from subsidized food to free universities.

But once again, oil moneys most impressive use is made in diplomacy and international aid. Chavez provides cheap fuel, refining projects and cash donations to his allies, particularly in South America.

chavezoil

In 2007, Venezuela pledged more than $8.8 billion in aid, financing and energy funding abroad. Venezuela provides 100000 barels of oil to Cuba every day.

One of Chavezs biggest international initiatives has been the Petrocaribe pact, which sells oil to Caribbean and Central American countries largely on credit, charging 1 percent interest over 25 years. Venezuela has financed more than $2 billion in sales to the pacts 18 members since 2005, sometimes accepting cattle, bananas, sugar, and medical care from Cuban doctors as partial payment.

The alliances it has furthered are valuable to Venezuela in international forums such as the United Nations, where small countries votes sometimes can carry the same weight as those from larger nations.

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