The petroleum leadership of Chávez

23/10/2000
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The idea of petroleum as a diplomatic weapon is not new in Venezuela. It had perhaps its most symbolic expression during the first administration of Carlos Andrés Pérez(1974-79). He launched a skillful international strategy which took advantage of high crude oil prices and a strong OPEC on the one hand, and on the other, the international climate which was increasingly in favor of South-South cooperation and the Venezuelan role as a major player in the realm of Latin America and the Caribbean. Today, under Hugo Chavez's administration, this idea of petroleum diplomacy is regaining strength in Venezuela, and is a position openly defended by the Minister of Exterior Relations, journalist José Vicente Rangel. Peréz's second administration (1989-93) and that of Rafael Caldera (1994- 99), like the transitional government of Ramon J. Velasquez - who held office in the interim following the judgement against Pérez -, coincided in distancing themselves from OPEC. They maintained oil policies that often conflicted with the common vision of the organization, and even considered the scenario of Venezuela's leaving the very entity it had helped to found 40 years ago. This position, which was also applied to the area of petroleum production, had negative consequences: the price of petroleum at the beginning of 1999 was at its lowest level since the 70s. This was a consequence of the overproduction embarked upon by several OPEC members and other producers, in a clear violation of the quotas established by OPEC itself for its 11 member countries. Strengthening OPEC Chavez's rise to power and the nomination of Alí Rodriguez as Minister of Energy meant the return of closer relations and friendlier dialogue, which have converged in a real political desire to strengthen OPEC. The gradual recovery of prices throughout 1999 and 2000 (excluding, of course, the recent prevalence of speculation and disturbance factors such as the Middle East conflict), are a consequence of the new policy which Venezuela has spearheaded. In 1999, Venezuela and Saudi Arabia reconvened a dialogue in order to reduce production, into which Mexico was integrated, and through which they were able to build bridges with non-OPEC producers such as Norway and Russia. This notable role was a major motive for Chavez's convening the second OPEC Summit of sovereigns, heads of State and government. It is significant that this was only the second such meeting in 40 years and that it had been 25 years since the first, in Argel (1975). The very fact of the summit can itself be considered a diplomatic success for Chávez and for Minister Rodríguez, currently president of OPEC. The media and the major Venezuelan pundits have underplayed importance of this fact, and focused on the specifics of the meeting rather than the significance of its occurrence. There was, as always, the "family photo". Chávez is the principal figure in this image, on the back of which could be written that it is the second in 40 years, a fact whose significance has already been mentioned; we are looking at the first image of unity of the organization since the 80s, and the summit served as an excuse for, for example, a private meeting of Iraqi and Irani leaders in a timely diplomatic move prompted by Venezuela. The tone of the "Caracas Declaration" is decidedly in favor of dialogue with consumer countries, and this is also a milestone, in addition to restoring OPEC to its role as a key player on the global scene. This is evidenced by the possible opening of dialogue with the European Union or with the group of the world's most industrialized countries, the G-7. Marking distances If the summit was a success, in terms of a relaunching of OPEC (whose members have made it clear that the Caracas meeting was not for debating prices), this is intimately related to Chavez's strong personality. We should not forget the trip, intense and exhausting if we consider the days and kilometers covered, which he made at the end of July to each of the other 10 countries in the organization in order to extend a personal invitation to the meeting in Caracas. Venezuela is the only OPEC member in the Western hemisphere, which meant that Chavez had to visit not only several Middle Eastern countries, but also Africa and Asia in order not to exclude anyone. In the process of this trip he demonstrated an important diplomatic independence with his historic visit to Iraq, as well as with the no less symbolic visit to Libya. With these two meetings Venezuela put a marked distance between itself and the influence of the US in foreign policy, as the international press recognized at the time. Criticized for his overtures toward this world "where democracy is not respected", Chávez was clearly ironic in saying that OPEC was not a club for defending democracy, but a coordinating body for petroleum policies for countries whose economies are closely tied to oil. He is now on the brink of being criticized once again for his petroleum diplomacy. After spending 1999 pressuring Mexico to amplify the San Jose Accord, which for 20 years has guaranteed a petroleum supply with special payment conditions to the countries of Central America and the Caribbean, Venezuela has launched its Caracas Energy Accord. The biggest novelty of this accord is that it will permit Cuba's inclusion among those countries which receive a guaranteed petroleum supply with advantageous terms of payment, given that the majority of the Antilles are not part of the San Jose Accord, and Mexico did not accept Venezuela's offer of integration. In addition to the criticisms which will arise for supplying petroleum to Cuba, which still flies the banner of socialism, Venezuelan diplomacy must act cautiously in the face of Mexico's eventual negative reaction and possible pressure from the English-speaking Caribbean countries because of Guyana's exclusion from the energy plan. But of course these are the risks of any foreign policy with personality, and this is what Chávez undoubtedly has in using petroleum as the axis of this diplomacy. One final indication of the role petroleum plays in Chavez's policy was the surprising appointment of General Guaicaipuro Lameda as head of the state-owned Venezuelan Petroleum (PDVSA). The active military man is not an expert on petroleum, but has the complete confidence of the Chief of State and has been a part of his government from the beginning, as director of the Central Budgeting Office.
https://www.alainet.org/pt/node/104913
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