"For example, while the Energy Ministry is claiming that Venezuela will not raise oil production in the second semester 2002 -- and will shortly resume oil shipments to Cuba that were interrupted on April 11 -- Finance Minister Tobias Nobrega said recently that the government would hike oil output by some 400,000 barrels per day to cover a fiscal deficit estimated at more than 8 percent of GDP.Also, high-level sources in the executive committee of state-owned oil monopoly Petroleos de Venezuela (PDVSA) warned that Cuba will not receive any more Venezuelan crude oil until it pays about $150 million owed for oil already received by the island, Caracas daily El Nacional reported. If Chavez attempts to force PDVSA to resume oil shipments to Cuba before Fidel Castro's regime pays its past-due debts, it is possible that the president could face renewed dissent within PDVSA that could encourage opposition forces to launch more street protests.
Apparently these sources are not former OPEC head Ali Rodriguez, who Chavez moved to President of PDVSA. Libya, Iran, etc., I bet, will exert pressure and infuse money to keep Chavez up, so to limit oil production and scare off investment in increasing capacity. The dirty little game continues, Castro carrying the water for OPEC and supplying muscle.
Chavez can't resist his pattern of driving the country into bankruptcy. He again plans to ship discounted (probably free) oil to Castro and he's draining all the profits from PDVSA. There also are reports he's emptied $2.3 Billion from the country's rainy day fund -- March 2002 - Oil and communism don't mix: Venezuela faces energy standoff at petroleum company*** After years of quiet complaints, the employees of Petroleos de Venezuela have begun to loudly protest the radical changes wrought by President Hugo Chavez……Lameda locked horns with the Energy Ministry on numerous issues, including the new hydrocarbons law that raises royalties and mandates that PDVSA be the controlling partner in any joint venture. Critics said these rules would stifle international investment.
Other bones of contention were the central government's demand that the company hand over $4.4 billion in dividends last year, forcing PDVSA to borrow $500 million to pay the bill; and the oil sales to Cuba, whose leader, Fidel Castro, is Chavez's longtime mentor. [· Chavez has insisted that oil sales continue to Cuba, despite an unpaid $97 million bill for past sales.]
One of the major disagreements centered on the Ministry's insistence on adhering to OPEC production cuts, but forcing PDVSA to continue producing surplus oil that has now filled every available storage facility. Although PDVSA cannot sell the oil, the catch is that it still must pay royalties for producing it to the central government, Lameda revealed after his departure. "I started warehousing" when prices were $26 per barrel, he told El Universal newspaper. "They're now $16. The barrels are worth less every day. I told the minister that I have to go out and ask for $500 million in loans while I have $300 million in the warehouse."***