Fausta's Blog

American and Latin American Politics, Society, and Culture

July 2, 2007 By Fausta

Sports, drugs, oil, and networks: all in Hugo’s trip

UPDATED

While I was away on vacation Hugo’s been touring, so it’s time for the freshest news on Latin America’s biggest tinpot tyrant:

Sports
Venezuelan Fans Embarrass Hugo… Chant “Freedom” at US Match. Let’s go to the videotape:

Not Sitting Still For Dictatorship

Drugs
Venezuela Becomes Cocaine Conduit

Of 46 suspected drug flights detected in the Caribbean by U.S. surveillance in the first four months of 2007, all but six originated in Venezuela.
…
But as Mexico cracks down on land shipments, and authorities get better at high-seas interdiction – the helicopters in the May 12 bust came off a British ship in the area – Venezuela is increasingly providing an alternative, counter-drug officials say.

Most Europe-bound cocaine is believed to pass through Venezuela, sent aboard ships and jets – 727s, DC-8s and Gulfstreams – to west African nations where enforcement is often weak and easily bribed, Hathaway said at the command’s headquarters in Key West, Fla.

Oil
Venezuela oil loss put at $4.5bn

The Chavez government is taking majority control of operations
US oil giant ConocoPhillips has said that a decision not to accept a minority stake in its operations in Venezuela may cost it $4.5bn.

The Economist: Exeunt Exxon and Conoco

Nevertheless, some Venezuelans worry that their country’s oil industry is going the same way as that of Iran, whose government is one of Mr Chávez’s closest allies. This week, as Venezuela’s president was due to visit Tehran on a tour that also takes him to Russia and Belarus, Iran imposed petrol rationing. Admittedly, Iran faces sanctions, and Venezuela does not. But national sovereignty does not automatically fill the tank.

Investor’s Business Daily focuses on how the markets took the news: Chavez’s Anaconda Embrace

Venezuelan dictator Hugo Chavez has expropriated $4.5 billion in assets from two U.S. oil firms. It’s an ugly loss, but they will live. What’s in doubt is Venezuela’s future.
…
Markets Wednesday offered a hint of what’s ahead, with Exxon’s stock ending 2% higher, leading the market upward on a down day, and Conoco ending flat.

Bear in mind that Exxon lost nearly a billion dollars in Venezuelan investments, and Conoco lost four times that much, amounting to 10% of its proved reserves.

Yet credit agency Standard & Poor’s declared Conoco’s rating undented by the move, and Exxon said it would “move forward,” probably signalling a bid to recover some of the value of its assets in U.S. courts.

Suddenly, Venezuela’s U.S. Citgo refining and marketing network has become a juicy target.

But Venezuela is another story. Its currency, the bolivar, and its sovereign bonds both plunged as Exxon and Conoco announced they’re leaving.

Most Venezuela watchers saw a link. Standard & Poor’s, for instance, downgraded the country’s outlook, citing “a highly negative climate for investment, which results in virtually no foreign and private investment.”

Venezuela has strict capital controls on its currency, so the bolivar trades only in the local black market. Its value to the dollar fell from 4,050 to 4,180 yesterday as dollar demand for capital flight rose, Bloomberg reported.

Even the “official” rate of 2,150 bolivars to the dollar signals ruinous inflation, likely well above the most recent inflation rate of 19%. A lack of dollars has emptied store shelves of imported goods, causing food prices to shoot up.

This is a bad sign for Venezuela. Markets basically shrug when two major investors leave, while brutally punishing Venezuela’s government for its treatment of its U.S. investors. Chavez’s regime is like one of the country’s anaconda snakes, squeezing the very life out of Venezuela itself. Sadly, it’s part of a long downward slide that shows no end.

Indeed, Venezuela’s Citgoing Nowhere.

And yes, I have mentioned before that the Venezuelan economy collapsed a couple of decades ago when the oil prices dropped.

Hugo’s network
Chavez in talks with Iranian ally

This was Hugo’s third visit to Iran during the presidency of Mahmoud Ahmadinejad, but he also visited old friends,

During his latest visit, which kicked off on Wednesday, Chavez met with Russian President Vladimir Putin and Belarus counterpart Alexander Lukashenko and urged a global revolution against Washington.

He has also discussed possible purchases of submarines and other defence equipment from Russia, arguing that these are needed to defend his oil-rich country against the United States.

Earlier this month Iran welcomed Nicaraguan President Daniel Ortega, a Cold War foe of the United States. Tehran has also boosted ties with other countries which have frosty ties with Washington, notably Belarus, whose president has been condemned by the European Union for rights violations.

More on the Iran visit:
Iran seeks stronger ties with Latin America
Hosseini says Iran, Venezuela to sign 20 agreements, MoUs
Chavez Prefers Russian Oil and Lenin

Both Venezuela and Russia have revisited contracts signed in the 1990s with major oil companies, and slapped back tax claims on private companies.

While we ponder that, read Austin Bay‘s post on Putin’s anti-missile tantrum – expect to hear similar rumbles from Hugo sometime in the future. It would get him the attention he craves.

Publius Pundit’s posts on Russian Hypocrisy Knows No Bounds has a whole photo gallery of Hugo’s buddies. Start with this one:

Yup, that’s Hugo Chavez and Moscow Mayor Yuri Luzhkov laughing and holding hands like lovers whilst they gaze upon a spectacle of Russian folk dancing as part of Chavez’s state visit to Moscow.

Meanwhile, The Devil’s Excrement posts that the Putin dominated Duma voted against receiving Chavez.

And then there’s this
Via Sigmund, Carl and Alfred, Middle East should look to Latin America: Tariq Ali

The Middle East lacks the social vision of Latin America which is currently undergoing a political revolution and successfully challenging American foreign policy, Tariq Ali told a sold-out audience at Sydney Ideas on Tuesday night.

Pointing to the success of Venezuela’s leadership under the seven-times elected President Hugo Chávez, the London-based historian, political campaigner and prolific author said: “Solidarity outside Venezuela is as important as solidarity inside Venezuela.”

According to the author of Pirates of the Caribbean: Axis of Hope (2006), a new level of unity lead by radical new leaders has had a “massive impact” on South America, and the region has broken down the isolationist policies driven by the United States through its ban on Cuba.

(For background on Tariq Ali, here’s a transcript of his debate with Christopher Hitchens from December 4, 2003.)

Will Hugo outdo his own $1,000,000,000 shopping tour from last year?

We’ll find out soon enough.

For now, he’s not going to Mercosur, and is even saying Venezuela may withdraw its bid to join the Mercosur trade bloc due to objections from congressmen from Brazil and Uruguay.

Update
Gustavo Coronel writes in Petroleum World,

This situation in Venezuela could trigger other, even more dangerous developments. Hugo Chavez has been losing much ground lately, both inside and outside Venezuela. His “revolution” is doing badly at home and abroad, due to his numerous errors and his undemocratic style of ruling. In Spain, Chile and Brazil he has lost most of the goodwill he had been able to accumulate in the past. The Democratic Party leaders in the United States have recently supported a resolution condemning his aggressions against freedom of expression. He is aligning his regime, more and more, with failed states, such as Cuba, Iran, Belarus, Zimbabwe and Syria. Right now he is in Russia, trying to recruit Putin to form a global alliance against the United States. I consider that Hugo Chavez is, at this moment, one of the most dangerous political leaders in the planet. If he sees that his political situation becomes untenable he could well resort to a Plan “B”.

What could this Plan “B” look like? It could consist of provoking a global political crisis by starting a violent, military action against a neighbor or against a U.S. aircraft or ship in the Caribbean area. This could be followed by a cut of oil supplies to the United States, which could be particularly dangerous if Iran decided to join him in a boycott against the U.S., while Russia sat on the fence in apparent neutrality and vetoed or delayed any action in the Security Council of the United Nations. I believe Hugo Chavez is determined to go down in history as someone who went well beyond the limits of his native state of Barinas and made a big impact in the world, and he no longer cares if this impact will be good or bad.

Digg!

Share

Filed Under: Communism, economics, Hugo Chavez, Iran, Mahmoud Ahmadinejad, oil, Russia, Venezuela, Vladimir Putin

Tweets by @Fausta
retirees_raise-2015_300x250

Pages

  • About
  • Email

Meta

  • Register
  • Log in
  • Entries feed
  • Comments feed
  • WordPress.org

Previous Posts

  • Mrs. Maisel goes full Alinsky on Mrs. Schlafly
  • Venezuela: Did the Minister of Defense back out at the last minute?
  • You need to unfriend me
  • Go ahead and Kiss the Girl, if you dare
  • Ashamed

Recent Comments

  • John on Mrs. Maisel goes full Alinsky on Mrs. Schlafly
  • Today’s hot topics: Democrats’ collusion shift, tax-return rift, Venezuela drift, and more! – PoliticalWitchDoctor.com on Venezuela: Did the Minister of Defense back out at the last minute?
  • Today’s hot topics: Democrats’ collusion shift, tax-return rift, Venezuela drift, and more! - AmericanTruthToday on Venezuela: Did the Minister of Defense back out at the last minute?
  • Did Venezuela’s Minister of Defense Back Out At The Last Minute? on Venezuela: Did the Minister of Defense back out at the last minute?
  • Roseanne Not Back, Khan not Invited, Operaman’s back, Jobs back, Fausta’s back (but not here yet) Thoughts under the fedora – Da Tech Guy Blog on Venezuela: Did the Minister of Defense back out at the last minute?

Archives

  • 2019
    • December 2019
    • May 2019
    • January 2019
  • 2018
    • December 2018
    • October 2018
    • July 2018
    • June 2018
    • April 2018
    • March 2018
    • February 2018
    • January 2018
  • 2017
    • December 2017
    • November 2017
    • October 2017
    • September 2017
    • August 2017
    • July 2017
    • June 2017
    • May 2017
    • April 2017
    • March 2017
    • February 2017
    • January 2017
  • 2016
    • December 2016
    • November 2016
    • October 2016
    • September 2016
    • August 2016
    • July 2016
    • June 2016
    • May 2016
    • April 2016
    • March 2016
    • February 2016
    • January 2016
  • 2015
    • December 2015
    • November 2015
    • October 2015
    • September 2015
    • August 2015
    • July 2015
    • June 2015
    • May 2015
    • April 2015
    • March 2015
    • February 2015
    • January 2015
  • 2014
    • December 2014
    • November 2014
    • October 2014
    • September 2014
    • August 2014
    • July 2014
    • June 2014
    • May 2014
    • April 2014
    • March 2014
    • February 2014
    • January 2014
  • 2013
    • December 2013
    • November 2013
    • October 2013
    • September 2013
    • August 2013
    • July 2013
    • June 2013
    • May 2013
    • April 2013
    • March 2013
    • February 2013
    • January 2013
  • 2012
    • December 2012
    • November 2012
    • October 2012
    • September 2012
    • August 2012
    • July 2012
    • June 2012
    • May 2012
    • April 2012
    • March 2012
    • February 2012
    • January 2012
  • 2011
    • December 2011
    • November 2011
    • October 2011
    • September 2011
    • August 2011
    • July 2011
    • June 2011
    • May 2011
    • April 2011
    • March 2011
    • February 2011
    • January 2011
  • 2010
    • December 2010
    • November 2010
    • October 2010
    • September 2010
    • August 2010
    • July 2010
    • June 2010
    • May 2010
    • April 2010
    • March 2010
    • February 2010
    • January 2010
  • 2009
    • December 2009
    • November 2009
    • October 2009
    • September 2009
    • August 2009
    • July 2009
    • June 2009
    • May 2009
    • April 2009
    • March 2009
    • February 2009
    • January 2009
  • 2008
    • December 2008
    • November 2008
    • October 2008
    • September 2008
    • August 2008
    • July 2008
    • June 2008
    • May 2008
    • April 2008
    • March 2008
    • February 2008
    • January 2008
  • 2007
    • December 2007
    • November 2007
    • October 2007
    • September 2007
    • August 2007
    • July 2007
    • June 2007
    • May 2007
    • April 2007
    • March 2007
    • February 2007
    • January 2007
  • 2006
    • December 2006
    • November 2006
    • October 2006
    • September 2006
    • August 2006
    • July 2006
    • June 2006
    • May 2006
    • April 2006
    • March 2006
    • February 2006
    • January 2006
  • 2005
    • December 2005
    • November 2005
    • October 2005
    • September 2005
    • August 2005
    • July 2005
    • June 2005
    • May 2005
    • April 2005
    • March 2005
    • February 2005
    • January 2005
  • 2004
    • December 2004
    • November 2004
    • October 2004
    • September 2004
    • August 2004
    • July 2004
    • June 2004
    • May 2004
    • April 2004
    • March 2004
Content Copyright Fausta's Blog

Site Developed and Managed by 300m.com