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Oil and Politics of Hugo Chavez

By Michael Rowan

03.10.06 | OIL. Since the late 1990s, Petrobras has doubled its oil production to 1.9mbpd and will be at 2.8 by 2011. It has done so by opening its ownership to global investors that have supplied the capital for its rapid expansion. Brazil owns 37% of the company and 56% of the voting rights. Most of the Petrobras shares are owned by global investors. Petrobras is not Lula's personal cashbox but a key national asset connected to and competitive in a globalized oil market.

Since 1999, PDVSA has lost 28% of its oil production capacity, going from 3.5mbpd to 2.5mbpd. It did so by closing the oil opening of the mid 1990s and firing PDVSA knowledge workers, replacing them with government loyalists who don't know how to run an oil company. Venezuela would be producing 5.5mbpd today if the opening had been continued. Venezuela owns 100% of the company and keeps most of its data secret from its true owners, the people of Venezuela. PDVSA is Chavez' personal cashbox: he has spent or given away up to $50 billion to foreigners in 2005-6.

Venezuela would be far better off with Lula's oil strategy than Chavez' oil strategy.


Chavez said yesterday that the election is "a battle for the revolution and against conspiracies and outside interference" in Venezuela. Chavez said that the election is "a fight against the imperialists and the manipulation of polls to destabilize the country."

He also explained how he became a revolutionary. He asked to play baseball in the military but they turned him down. He argued his case with a superior officer. So he disobeyed the order, got caught, and was given 48 hours of detention time. He singled out that moment as his point of rebellion.

He also said he would carry Miguel Cabrera's baseball bat with him for the rest of the campaign, comparing it to Bolivar's sword, Zamora's horse and Maisanta's machete. He did not compare it to Mi Negra or say how the bat could be used to beat poverty, but he did say he would hit another home run and knock the devil 5,000 feet into the sea.

With more sports metaphors than Nixon, Chavez is showing just how far removed he is from the life of the people he governs. Nixon also suffered from that problem.

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