Street Journal Claims Chavez Oil Policy "Aims To Weaken US"
By Stephen Lendman
04 May, 2007
Wall Street Journal's main Hugo Chavez antagonist is its self-styled
Latin American "expert" Mary Anastasia O'Grady who makes up
for in imagination and vitriol what she lacks in knowledge and journalistic
integrity. She, however, wasn't assigned to write the May 1 Journal
attack piece reporters David Luhnow in Mexico City and Peter Millard
in Caracas got to do titled "How Chavez Aims to Weaken US."
Of course, when it comes to Venezuela, the issue is oil and Chavez's
having the "audacity" to want his people to benefit most from
their own resources, not predatory foreign oil companies the way it
used to be when the country's leadership only served the interests of
capital ignoring essential social needs. No longer.
Chavez, of course, announced
months ago his government would complete renationalizating his country's
oil reserves when state oil company PDVSA became the majority shareholder
May 1 in four Orinoco River basin oil projects with a minimum 60% ownership
in joint ventures with foreign partners. The plan was broadly denounced
in the US major media with Journal columnist O'Grady writing April 16
"Chavez (was) brimming with bravado as he shredded (the) oil contracts
(telling) foreigners to step aside because he's in charge now (but the
move will likely) end up hitting the 'commandante of the revolution'
in the pocketbook (because of) corruption, incompetence and mismanagement"
meaning Venezuela will now run all its own oil operations and forge
its own future, not Big Oil O'Grady wants sole right to do it. No longer
indeed, and O'Grady's not pleased. She's also dead wrong in her outlook
for Venezuela's oil future run by PDVSA with foreign partners, but don't
ever expect her to admit it.
So is the New York Times
agreeing April 10 with O'Grady and other corporate media Big Oil cheerleaders.
The Times used charged language condemning Chavez's "revolutionary
flourish (and his) ambitious (plan to) wrest control of several major
oil projects from American and European companies (with a) showdown
(ahead for these) coveted energy resources...." The Times went
on to claim this action would undermine Venezuela's growth hinting Big
Oil's threat to leave might get Chavez to back down enough to get them
to stay. It never happened as this writer suggested April 12 in an article
titled "Wall Street Journal and New York Times Attack journalism."
The article made it clear oil exploration and production in Venezuela
is so profitable that even with a smaller share of the profits US, European
and other Big Oil investors wouldn't dream of leaving. Whine plenty,
leave, not likely, and now we know they won't.
AP's Natalie Obiko Pearson
reported April 26 that "Four major oil companies (stopped whining
April 25 and) agreed to cede control of Venezuela's last remaining (majority-owned)
privately run oil projects to President Hugo Chavez's government"
with ConocoPhillips coming around May 1 showing it, too, was all bark
and no bite. Those agreeing through signed memorandums of understanding
were Chevron, BP(Amoco) PLC, France's Total SA, Norway's Statoil ASA,
ConocoPhillips, and with most antagonistic of all to the idea ExxonMobil
finally doing it privately as was almost certain to happen and then
AP reported ConocoPhillips
has the most Orinoco basin exposure in two of four projects, Ameriven
and Petrozuata with a (former) 50.1% stake in the latter. It was inconceivable
the company would abandon them, and on May 1 it announced it would stay
on. The one remaining issue to be resolved is compensation with foreign
investors having until June 26 to negotiate terms for their reduced
stakes. Expect more Big Oil whining followed by capitulation again to
Venezuelan Energy Ministry's expected offer of fair and equitable takeover
On April 26, PDVSA's web
site reported a total of 10 foreign oil companies agreed to transfer
majority control of their "Oil Belt" operations to the state-run
oil company. Further, the company expects to achieve a daily capacity
of 5.85 million barrels in 2012 and said its January 1 taking control
of 32 oil fields will advance the country "toward full national
sovereignty over (its) natural energy reserves."
In response to these actions,
and on the day it took effect, the Journal went on the attack again
with more ahead certain to be as false and misleading. Its writers called
Chavez a "self-proclaimed Maoist (wanting to) reshape the global
oil business by sidelining the US and making China his country's chief
strategic energy partner" for investment and export. The Journal
also accused Chavez of using "oil as a political weapon" since
taking office in 1999 offering discounted oil "to dozens of Latin
American countries" as his weapon of choice plus forging alliances
with US "economic rivals like China and political rivals like Iran."
Hugo Chavez, in fact, is
a self-proclaimed social democrat charting his own independent course
toward progressive "21st century socialism" along the lines
Latin American expert James Petras calls the "pragmatic left"
in contrast to the more "radical left" of Colombia's FARC
guerrillas; elements of "teachers and peasant-indigenous movements
in Oaxaca, Guerrero and Chiapas in Mexico;" many "small Marxist
groups in Argentina, Bolivia, Chile and elsewhere;" and Venezuela's
"peasant and barrio movements," among others. Other Latin
American leaders Petras calls "pragmatic" leftists include
Bolivia's Evo Morales, Cuba's Castro and many "large electoral
parties and major peasant and trade unions in Central and South America"
including Mexico's PRD party, El Salvador's FMLN, Chile's Communist
Party, "the majority in Peruvian (Ollanta) Humala's parliamentary
party;" and others including "the great majority of left Latin
Unlike what the Wall Street
Journal and rest of the US corporate media report or imply, Chavez and
others on the "pragmatic left" aren't aiming to destroy capitalism,
just tame it. They also plan no wholesale renunciation of accumulated
IMF, World Bank and other international lending agency debt, only calling
for it to be on more equitable terms; restructuring it to make their
nations' debt burden fair; and aiming to become free from its repressive
yoke as Venezuela did paying it off completely with Chavez announcing
May 1 his country is pulling out of the IMF and World Bank, formally
breaking free from the kind of debt slavery these institutions impose
on countries they lend to guaranteeing their people continued impoverishment.
It's an important move that
may encourage other countries to follow as Ecuador's President Raphael
Correa already did ousting the country's World Bank representative saying
"we will not stand for extortion by this international bureaucracy."
Look for more IMF-World Bank resentment to surface ahead as Chavez's
and Correa's courage may embolden other leaders to move in the same
direction or at least begin by openly voicing public discontent as a
first step to possible policy change to follow.
Hugo Chavez offers them a
new choice having announced in March he intends creating a Bank of the
South social democratic alternative to the repressive neoliberal Washington
Consensus IMF-World Bank model. So far Bolivia and Argentina have agreed
to be part of it with Chavez hoping other Latin countries will join
as well by contributing 10% of their capital reserves for this enterprise
he hopes will be operating by summer.
Additional parts of Chavez's
plan involve forging stronger ties to other oil importing nations like
China to reduce Venezuela's dependency on a hostile US. He also announced
April 29 the nation hopes to gradually sell its seven US-based Citgo
refineries replacing them with a new Latin American-based network in
Bolivia, Ecuador, Nicaragua, Haiti and Dominica. It's part of his plan
to provide the region a stable oil supply and 100% of the energy needs
for Alternative for the Americas (ALBA) members and Haiti.
He further offers discounted
oil to Latin American and other nations, not to buy support as the Journal
claims, but to build progressive ALBA trade and other good neighbor
alliances with regional nations the opposite of WTO-style Global North
exploitive one-way deals. The Fifth ALBA Summit held in Barquisimeto,
Venezuela just ended April 29 at which heads of state from Venezuela,
Bolivia, Cuba, Nicaragua and Haiti signed strategic ALBA agreements
with delegations from Ecuador, Uruguay, Dominique and St. Vincent and
the Grenadines also attending along with social movements from other
Chavez aims for more than
just fair and equitable trade and other commercial, industrial and energy
deals, and Summit leaders made progress toward them. They agreed to
alliances in ALBA Education, Health, Culture, Food, and Telecommunications
that may ahead extend Venezuela's and Cuba's social agenda to other
ALBA countries and Haiti.
The May 1 Wall Street Journal
article says "Chavez wants to replace the US as Venezuela's main
partner and client in the oil business (and) The big winner could be
(big, bad US rival) China" that spells bad news for Washington
and Big Oil. It continued saying the country has the largest proved
reserves outside the Middle East, and if Chavez succeeds he'll force
the US to be even more dependent on that volatile region than it already
is. Further, Journal writers take aim at PDVSA demeaning it as a state-run
company claiming it has "little focus" because Chavez turned
it into a "poverty-alleviation ministry." As a result, the
Journal says it became inefficient and its production fell from 3.1
million barrels a day when Chavez first took office in 1999 to 2.4 million
barrels a day now according to US government Energy Information Administration
(EIA) figures that look to have been cooked to bring them down.
They're disputable with differing
ones coming from alternate sources including the 2006 CIA World Factbook
listing Venezuela's daily production at slightly under 3.1 million daily
barrels, around the same figure PDVSA reported then including extra-heavy
crude from Orinoco belt production. In May, 2006, Venezuelan Minister
of Petroleum and Energy, Raphael Ramirez indicated the International
Energy Agency (IEA) recognized the nation's daily oil production at
over 3 million daily barrels while the government reports it now at
3.3 million compared to 2.6 million or less claimed by international
oil analysts and EIA deliberately understating oil output the way Washington
and the West distort everything positive about Venezuela under Hugo
The Bush administration and
US corporate media, flacking for Big Oil, is all over Hugo Chavez with
the Journal's May Day article staying true to form. It ends saying Venezuela
"was historically one of the US's most reliable energy allies"
pumping all out to guarantee America a steady supply when it was most
needed as it did in WW II, the 1973 Arab oil embargo and the 1991 Gulf
war. It then blamed Chavez for changing that instead of reporting Washington
was at fault for soured relations that hit rock bottom during the aborted
two-day April, 2002 coup against him the Journal can't admit the US
instigated and supported.
All it can say, with a heavy-handed
dose of sour grapes, is that "Mixing oil and politics may not help
Mr. Chavez in the long run" as he'll need "private companies'
expertise to develop the heavy crude in the Orinoco region" without
ever conceding he already has it and a long line of takers ready to
step in if any now there foolishly leave. They won't, but don't expect
to see that opinion reported anywhere in the Wall Street Journal as
they'd then have to admit everything they wrote earlier was false and
misleading. They don't have to. You just read it here.
Stephen Lendman lives
in Chicago and can be reached at email@example.com.
Also visit his blog site
at sjlendman.blogspot.com and listen each Saturday
to the Steve Lendman News and Information Hour on The Micro Effect.com
at noon US central time.
it! And spread the word!
Here is a unique chance to help this article to be read by thousands
of people more. You just Digg it, and it will appear in the home page
of Digg.com and thousands more will read it. Digg is nothing but an
vote, the article with most votes will go to the top of the page. So,
as you read just give a digg and help thousands more to read this article.
here to comment
on this article