Posted on 10/13/2008 1:08:12 PM PDT by St. Louis Conservative
To win allies and forge an anti-American front, Mr Chavez sells oil to friendly countries at low prices. Ironically, the only big customer buying Venezuelan oil at the full market price is the United States, which the president routinely denounces as the "Empire".
"As production falls, the sales to the US become more important," said Pietro Donatello, an oil analyst from Latin Petroleum in the capital, Caracas. "Only the US is paying the full amount for Venezuelan oil and in cash, the rest are in some kind of barter agreements."
The state oil company, PDVSA, produced 3.2 million barrels per day in 1998, the year before Mr Chavez won the presidency. After a decade of rising corruption and inefficiency, daily output has now fallen to 2.4 million barrels, according to OPEC figures. About half of this oil is now delivered at a discount to Mr Chavez's friends around Latin America. The 18 nations in his "Petrocaribe" club, founded in 2005, pay Venezuela only 30 per cent of the market price within 90 days, with rest in instalments spread over 25 years.
(Excerpt) Read more at telegraph.co.uk ...
This truly brightens my day (along with the soaring DOW)
Yep, Chavez going downhill and the DOW up 10% today.
Why are we doing this?
This goes against every free-market conservative bone in my body, but I kinda want the government to seize all the assets of Citgo (owned by Venezuela) and have an auction where they are sold off to American (or other friendlies) investors. We could REALLY screw Chavez that way.
Because the closest refineries that can deal with his crappy high sulfur crude are located here.
L
“Nationalizing PDVSA sealed its fate as a going concern. Communist thugs like Chavez booted the western oil companies and engineers, and has plowed the oil revenues into social welfare programs instead increasing production and finding new reserves.”
No matter what Chavez does, the oil will always be there. I suggest we also barter for his oil. Let’s send him some subprime mortgages and credit default swaps. Those seem to be our leading exports.
When do the Chavez thugs start executing people for “hoarding” when they don’t produce as much as they did before incentives were removed?
Yep, Chavez going downhill and the DOW up 10% today.”
Chavez seems to be taking his cues from Mugambe...
No matter what Chavez does, the oil will always be there. I suggest we also barter for his oil. Let’s send him some subprime mortgages and credit default swaps. Those seem to be our leading exports.’
I nomivate that we also send him the 44,000 sex offenders that were living in NO when Katrina hit....10% of NO population.....
oh, wait...no one knows where they are now, because these felons have NOT reported their new addresses.....so sad.
Supposedly Chavez gives away a lot of the oil and we pay for it. I did not read this story but read it or another one today. It said if oil goes below $80 a barrel then he and Venez are in big trouble. The country could go technically bankrupt like Cuba, Zimbabwe, Detroit, CallieForneeha.
That would excite every third world country in the world. The interesting point is that a pipeline is currently being built from Canada to supply oil from the oil sands to Gulf Coast refineries. Guess who won’t be selling as much oil to the US? Chavez is screwed. He just doesn’t know it yet.
Venezuelan wells haven’t been maintained so production is dropping anyway. With the Iranian oil minister squealing like a pig over falling oil prices, Venezuela will have to compete with their buddies Iran and Russia for what’s left. It’s more complicated than that. But you get the point.
Socialism doesn’t work.
Imagine that.
The mighty leader will simply force the oil industry to produce more. There is no problem here. Move along you sulfer stinking devils!
And, it's probably a good idea to remember that there is only one American oil company left among what Obamatons call "Big Oil." That's ExxonMobil, of course. Citgo is owned outright by Chavez and his government. Keep that in mind when you are looking for that extra two cents off per gallon in the drop underway. Don't buy oil from Citgo.
Best side effect of dropping oil prices is what it does to thugs like Chavez.
And a lot of Venezuela' oil is very low API gravity stuff that's difficult to pipeline and difficult to process.
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