Chavez Threatens to Nationalize Banks, Steel Producer(Time to "take out the trash.")

theglobeandmail.com ^ | May 3, 2007 | JORGE RUEDA

[brownsfan]

I can’t wait until China does this.

[dynachrome]

http://www.ternium.com/en/contactos/default.asp
These guys own Sidor steel. You can leave a message. J. Galt of Reardon Steel did.

[popdonnelly]

Good, let him do it. He’ll turn Venezuela into the next socialist dump. Nobody ever seems to learn from other’s (Cuba’s) mistakes. And the Left will think he’s wonderful, like they always do. Same old nonsense, decade after decade, century after century.

[steamroller]

worse-there’s nothing in zimbabwe that anyone wants

[jaz.357]

Sounds like this rookie is just getting warmed up!

[baiamonte]

I bet Venezuela is importing oil before the end of the year. This is fun to watch.

[thackney]

Citgo is owned by PDV America, Inc., an indirect, wholly owned subsidiary of Petróleos de Venezuela, S.A., the national oil company of the Bolivarian Republic of Venezuela. Venezuela exports about 2.2 million barrels per day, not all owned by Petroleos, but a significant portion and consequently they have a lot of funds. In my opinion, the problem they are having and will continue to get worse is Chavez is using their oil company as a cash cow to fund his many social programs.

You have read me and others point out the the major oil companies, although they are having record revenues in terms of dollars, the percentage of profit remains about 10%. That is because they are pouring money into exploration and expanding infrastructure. The nature of the cyclic oil business is you build up when you got the money from high prices and try to hold on and just survive when prices are low.

If Chavez does not continue to build on exploration and infrastructure now, the existing wells become partially depleted, the amount of total oil production goes down and when the prices do fall back to average or below, Venezuela will be in a world of hurt. They have already gotten behind. As part of OPEC, limits are set on how much oil they are “allowed” to produce. It has been years since Venezuela could even produce up to their limit or quota. Even with the reduction of quotas from late last year and this year, Venezuela cannot pump that much oil because the have gotten behind on keeping up.

In addition to the national oil company not investing their profits, the oil majors have been very reluctant to invest in their facilities any more capital. The threats of nationalization has been out their for a while.

[kellynla]

Thanks for the info.

So, in your opinion, can Venezuela continue to prosper if Chavez nationalizes the banks & Citgo continue to prosper without foreign investment?

[mtntop3]

Seems I heard that the planned oil sands exploration/development there by U.S. and other companies has now been curtailed or aborted. But perhaps the Chinese will do it...

[thackney]

can Venezuela continue to prosper

I would say a country with their current wealth that is already having some food shortages stopped prospering a while ago.

Food Plan for Venezuela Masses

The food basket in Venezuela jumped 35 percent in April 2006-April 2007

The Centro de Documentación y Análisis Social de la Federación Venezolana de Maestros, a teachers’ union think tank, reported in 2006 that 80 percent of Venezuela’s households have difficulty covering the cost of food

Economists analyzing the squandering of petrodollars by Venezuelan ruler Hugo Chávez are of the opinion that that country’s economy will collapse sooner than most people could imagine, because it is not possible to continue with so much waste, so many gifts to entice satellite governments and avoid a failure.

...News from Venezuela are constantly reporting about the scarcity of food for low-income people, deteriorating streets and highways and shocking poverty in shantytowns on the hills near Caracas.

[thackney]

Not oil sands, but heavy oil. And yes, they majors have cut back or eliminated expansions that were planned just a few years ago.

[kellynla]

Thanks for the links

I’ll read them tomorrow.

Reveille comes early here. LOL

Good night.

[D-fendr]

I’d like to see CITGO’s assets seized to pay back American companies nationalized assets.

[jonno]

Amazing - like a chapter out Atlas Shrugged...

“Would the last industrialist to leave Venezuela, please turn out the lights?”