Strike is far from over. You let the anti-Chavez people back into the refineries,
they'll be sabotaging the hell out of everything. Dissented people don't work.
Yo Ho Chavez Most Go !Posted on 02/19/2003 1:19:33 AM PST by Cincinatus' Wife
CARACAS, VENEZUELA - With most of Venezuela back at work, President Hugo Chávez has emerged from a devastating 2-1/2-month strike with control of a key asset - the petroleum industry.
Mr. Chávez's opposition had taken control of the state-run oil company, Petroleos de Venezuela (PDVSA), on Dec. 2 and slowed production to a trickle. But Chávez consolidated power by firing as many as 12,000 of the company's 38,000 workers and calling in retirees as replacements.
The company has raised production faster than many industry analysts had expected - up to 1.9 million barrels a day, according to the government. Ali Rodriguez, PDVSA's president, says that he expects production to rise to "near normal" levels by mid-March. Venezuela produced 2.8 million barrels a day before the strike.
But some analysts say it could be months, if not years, before Venezuela returns to the ranks of the world's oil elite. For a country that relies on oil revenue for 80 percent of government funds, this could be a blow to funding of social programs and even lead to oil-industry privatization.
"At the end of the day, PDVSA will not get back to where it was any time this year," says Larry Goldstein, President of the International Petroleum Research Foundation in New York.
Getting pumps and refineries going again is not as simple as throwing a switch. The oil behemoth's skeletal staff has to tussle with complex engineering tasks, from gauging oil flow in dormant pipes to reconfiguring computer systems to replacing a catalytic cracker module on a stalled refinery. Half of Venezuela's petroleum comes from particularly viscous oil deposits, and many wells became filled with sand after the oil pressure was cut.
"Some fields you should never shut down, and they were shut down," says Ramon Espinasa, a consultant at the Inter-American Development Bank in Washington and a former PDVSA economist. "A large number [of wells] will have to be redrilled."
Mr. Goldstein says that some wells will have to be abandoned altogether. He estimates that 400,000 barrels per day have been permanently lost.
A crowded slate of technical challenges falls to a PDVSA workforce that is practically headless, as most of the firings occurred in the ranks of senior managers, scientists, and economists. PDVSA is severely short-staffed, and workers who have been brought out of retirement are scrambling to learn new computer systems.
Reaching prestrike production levels will call for further exploration, and that requires cash - yet another problem. PDVSA announced it will tighten its belt by $2.7 billion this year, nearly one-third of its budget.
"To run this corporation they need capital and labor, and they have neither," says Mr. Espinasa.
With a battered credit rating making borrowing expensive, to raise money PDVSA may have to sell assets in Germany, Sweden, and the Caribbean, as well as portions of company-owned Citgo, which operates 13,400 gas stations in the US.
Some analysts say that, eventually, Chávez will have to have to increase privatization, turning to large multinational oil companies already operating in Venezuela. To lure foreign investors, a law which dictates that Venezuela maintain at least a 51 percent stake in all joint ventures may have to be revised.
"The international oil companies are all here," says one Caracas-based analyst. "They're not vultures, but we can say that they're waiting on the wire fence to pick up the pieces."
The political struggle for control of PDVSA shows no signs of abating. Some strikers are refusing to return to work until Chávez agrees to early elections. Opponents accuse him of trying to turn the country into a Cuba-like socialist state and decimating the economy, which may contract by as much as 25 percent this year.
In the meantime, PDVSA is being split into two units, one for eastern Venezuela and one for western Venezuela, in order to avoid Caracas, where antigovernment sentiment runs high.
Antonio Herrera, general manager of the US-Venezuela Chamber of Commerce, is confident that the US will find other sources of oil to make up for Venezuela's shortfall. But he suspects that the worst is yet to come for the Venezuelans. "We're really heading for a calamity in the economy," he says. "The oil industry is decimated. It's a major annoyance for the United States.... It's a tragedy for Venezuela."
Yo Ho Chavez Most Go !
Only last July, the leftist leader's supporters were out celebrating his re-election in the streets of Caracas, but by April 2002 the whole country was embroiled in a general strike.
 What my rivals don't understand... is that Hugo Chavez is not Chavez but the people of Venezuela Venezuelan President Hugo Chavez
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This admirer of Fidel Castro's Cuba and avowed anti-globalist was pushed from office on 12 April - as a result of his attempts to take control of the world's fifth-biggest oil industry.
But just two days later, after his supporters - mainly Venezuela's poor - took the streets, he was back in the presidential palace.
Eight months on, Mr Chavez is facing his fourth national strike this year - one that is threatening to severely disrupt the country's economy.
Revolutionary promises
The former army paratrooper burst back on to the political scene in 1998, promising to transform Venezuela.
But as Mr Chavez proved unable to bridge the huge gap between the country's rich and poor, his combative rhetoric alienated and alarmed the country's traditional business and political elite.
When Mr Chavez came to power, the old Venezuelan order was falling apart.
Unlike most of its neighbours, Venezuela had enjoyed an unbroken period of democratic government since 1958, but the two main parties which had alternated in power stood accused of presiding over a corrupt system and squandering the country's vast oil wealth.
Hugo Chavez promised "revolutionary" social policies, and constantly abused the "predatory oligarchs" of the establishment as corrupt servants of international capital.
The great provocateur
This populist leader, who never missed an opportunity to address the nation, once described oil executives as living in "luxury chalets where they perform orgies, drinking whisky".
Church leaders in this overwhelmingly Roman Catholic country fared no better. "They do not walk in... the path of Christ," said Mr Chavez at one stage.
 Chavez and Castro both oppose US domination
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He courted controversy in foreign policy, too, making high-profile visits to Cuba and Iraq, while allegedly flirting with leftist rebels in Colombia and making a huge territorial claim on Guyana.
Relations with Washington reached a new low when he accused it of "fighting terror with terror" during the war in Afghanistan after 11 September.
But Mr Chavez's "revolution" had little real impact on the lives of ordinary Venezuelans, who still suffer from chronic poverty and widespread unemployment despite the country's oil wealth.
His popularity rating had fallen from a high of 80% to 30% last December, when the first mass street protests erupted.
But, as his dramatic return to power showed, Mr Chavez still commanded much grass-roots support.
From coup-leader to president
The ex-paratrooper's journey along the road to power has been an eventful one.
Mr Chavez first came to prominence in February 1992 when he led an attempt to overthrow the government of President Carlos Andres Perez amid growing anger at economic austerity measures.
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Hugo Chavez
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Born 28 July 1954 in Sabaneta, State of Barinas, the son of schoolteachers
Graduated from Military Academy with a degree in engineering in 1975
Has five children, three girls and two boys
Keen baseball player
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But the foundations for that failed coup had been laid a decade earlier, when Mr Chavez and a group of fellow military officers founded a secret movement named after the father of South American independence leader, Simon Bolivar.
The February revolt by members of the Revolutionary Bolivarian Movement claimed 18 lives and left 60 injured before Colonel Chavez gave himself up.
He was languishing in a military jail when his associates tried again to seize power nine months later.
That second coup attempt in November 1992 was crushed as well, but only after the rebels had captured a TV station and broadcast a videotape of Colonel Chavez announcing the fall of the government.
Mr Chavez spent two years in prison before being granted a pardon.
He then relaunched his party as the Movement of the Fifth Republic and made the transition from soldier to politician.
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