Former PDVSA President Luis Giusti said the law clashes with the spirit of mid-1990s reforms that opened Venezuela's petroleum industry to joint-ventures with foreign oil companies. The move generated $20 billion in foreign investment and Venezuela's production rose to a record 4 million barrels a day, making the state-owned company among the 10 biggest oil companies in the world. Giusti has argued that Venezuela should further liberalize its oil industry, a trend he said is taking place in other countries, including fellow members of the Organization of Petroleum Exporting Countries.
Chavez, who will inaugurate the Hydrocarbons Law on Friday in oil-rich western Falcon State, promotes an oil policy that favors extracting the highest earnings possible per barrel over maximizing production. Despite record oil production in the mid-1990s, corporate tax breaks and plunging oil prices left government coffers scraping bottom, Chavez said.
Since taking office in 1999, Chavez said Venezuela has promoted healthy world oil prices through strict compliance with production quotas set by OPEC. Now, the government wants to create a steadier revenue flow by imposing the world's highest royalty rates on companies exploring and exploiting Venezuela's state-owned oil fields. The Hydrocarbons Law raises royalty rates from 16.7 percent to 30 percent. Giusti warned the new rates will drive investors to other oil producing countries, where rates do not exceed 20 percent and the average rate is 7.1 percent. Among Venezuela's fellow OPEC members, the average is 14.7 percent.***
Insight Magazine - Fidel May Be Part of Terror Campaign***"Tours through radical Islamic states by Castro and his close Venezuelan ally, President Hugo Chavez, in the months prior to the September attacks indicate some level of complicity or knowledge of what was going to happen," says Lisette Bustamante, a former aide to Castro who currently works on the Spanish daily newspaper La Razon.
Not only were statements by both leaders in their Middle Eastern trips laced with violent anti-American rhetoric, Bustamante points out, but Chavez quite candidly told reporters that his talks with Saddam Hussein and heads of other oil-producing states involved the creation of a "new anti-imperialist axis" against Western industrialized economies.
It was just the sort of anti-American blather that tends to excite the faithful remnant of the old-guard communists, say U.S. intelligence analysts. Mysterious predictions about some catastrophic event in the United States began to circulate in the electronic traffic and even were voiced by Russia's Pravda on Aug. 1 under the headline, "The Dollar and the U.S. Will Fall." Based on interviews with the Malaysian ambassador to Moscow and a group of Russian economists, the report was taken seriously enough for members of Russia's parliament, the Duma, to advise Russian citizens to cash out dollars. An adviser to the Duma's Commission on Economic Politics, Tatyana Koryagina, even specified late August or early September as the likely time for an attack on the United States that would lead to its economic collapse.***