Oil, Chavez, and the Orinoco Belt

With the lightning speed that only a would-be dictator can muster, Hugo Chavez grabbed power in Venezuela last week. Greedily grabbing all the levers of authority, Chavez made the next move in his promise to deliver utopia to his people. And when all of the votes had been counted, Chavez promptly took his place in the string of history’s other leaders who also boldly proclaimed, “I am the state.”

In the meantime, however, it is his country’s position as the number-four supplier of imported oil to the United States that promises to deliver his socialist misery to our doors.


On Thursday, the country announced that by May 1 it would nationalize the remaining petroleum resource projects still being held in partnerships with some of the world’s biggest oil companies. Affected by the decree are firms such as Chevron, Exxon Mobil, Conoco Phillips, Statoil and BP, which may now lose an estimated $8 billion in value to the state.

At the center of this money grab are the heavy oil fields in what is known as the Orinoco Belt.

Energy and Capital