The Chronicle‘s Editorial LiveJournalists crept up on genuine insight today before quickly veering off:
In February, President Chavez, contrary to Citgo’s pledge, threatened to cut off all crude oil exports to the United States if the U.S. government went over the line in its opposition to Chavez’ leftist regime. Chavez could not make good on his promise, though, without depriving Citgo’s refineries of their raw material and high profits.
If Chavez means what he says, perhaps more of Citgo’s assets will go on the block. That would unlock billions of dollars in cash that Chavez could use for his political ambitions without fear that the United States could seize Venezuelan assets here following some outrage Chavez might be plotting.
“It’s not where we’ve been,” Citgo proclaims. “It’s where we are heading that can make a world of difference.”
That’s what we’re afraid of.
Chavez likely won’t make good on his “promise” because, as the Editorial LiveJournalists seem to understand, he really needs the hard cash from crude exports to the United States (to fund his domestic social welfare utopia, not to mention his foreign policy initiatives). In addition, he needs the United States to import his oil (because our refineries can handle Venezuela’s heavy, sour crude, not a trivial consideration). Chavez might still wield the crude-oil weapon one day, but if he does, he will hurt himself in the process; so far, he seems to understand that.
Whether Chavez’s whims result in the selloff of Citgo assets in the United States is sort of a tangential concern (so the Editorial LiveJournalists focus on it). The bigger concern is that Chavez’s whims have resulted in the politicization and de-professionalization of PDVSA, hindering the once-respected state company’s ability to manage Venezuela’s exploration and production for years to come.
