Chavez's cheap oil for US poor angers Washington

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Chavez's cheap oil for US poor angers Washington

 

By Alec Russell in Washington November 25, 2005

 

Venezuela's President, Hugo Chavez, has pulled off his greatest public

relations coup yet in his campaign to irritate the Bush Administration

with a deal to supply cheap fuel to thousands of poor residents of

Boston and New York.

 

To the anger of many in Washington, Citgo Petroleum Corporation, a

company controlled by the Venezuelan Government, will supply more than

45 million litres of oil at 40 per cent below market prices.

 

The deal is one of the most spectacular moves yet in Mr Chavez's

attempt to market his " 21st-century socialism " using his country's oil

wealth.

 

While it will not change many minds in Washington about his populist

and autocratic regime, Caracas hopes it will bolster Mr Chavez's claim

as the coming leader of an anti-capitalist Latin America. Mr Chavez,

who once dubbed President George Bush a " genocidal madman " and led a

huge anti-US protest earlier this month, first proposed his fuel offer

in August when oil prices were at a record high after Hurricane

Katrina.

 

Joe Kennedy, the chairman of Citizens Energy, one of the organisations

that will distribute the oil, said the deal highlighted the failure of

oil companies in the US and the Government to step in to help.

 

" Our government has made billions of dollars just this year on the

royalty payments the oil companies pay to the Government, " he said.

But when it is a question of poor Americans, " what do we hear from

Washington? Sorry boys. There's no money in the till. "

 

To promote his dream, Mr Chavez has offered cheap oil and refineries

to his neighbours and pledged financial support for regional

development programs.

 

All the while he has positioned himself as a rival to Washington,

accusing the Bush Administration of plotting a coup against him, and

predicting the imminent demise of American capitalism.

 

The US on Wednesday threatened to block a record-breaking arms deal

under which Spain would sell ships and aircraft to Venezuela, claiming

that the €1.3 billion ($2 billion) arms deal with Mr Chavez could

destabilise the region.

 

The deal, due to be signed in Caracas on Monday, would be a huge boost

to Spain's ailing shipyard industry and to the rest of its defence

industry.

 

" Those air or naval platforms include US technology, " the US

ambassador to Madrid, Eduardo Aguirre, said on Wednesday. " We have not

yet decided whether to grant our permission for obtaining that

technology. "