Bolivarian hydrocarbons

Chavez's oil offers are hard to refuse

After twelve years of inactivity, an oil refining complex built in the 1980s with Soviet help was launched in the Cuban city of Cienfuegos on Saturday. The enterprise, mothballed in 1995 due to the cessation of Soviet oil supplies, will now receive raw materials from Venezuela. The opening of the refinery was attended by Venezuelan President Hugo Chavez, who was visiting Liberty Island these days. Another refinery, located in the city of Santiago de Cuba, will also increase production volumes as the flow of Venezuelan oil into Cuba is growing.

The fourth summit of the Petrocaribe oil alliance (which includes 17 countries in the region, including Honduras, which joined the summit), held on December 21 in Cienfuegos, stimulated cooperation between Caracas and Havana. Hugo Chavez is not the last person in this alliance - Petrocaribe was created in 2005 on the basis of a Venezuelan state-owned oil company. With the support of Cuban leader Fidel Castro, he is promoting the “Bolivarian alternative” in the field of regional hydrocarbon trade, which boils down to the supply of Venezuelan oil to Latin American countries through barter and other mutually beneficial schemes. Havana receives raw materials for the refinery, and Caracas receives sugar, other products and qualified Cuban medical personnel.

Those Petrocaribe participants who have not yet chosen the “Bolivarian alternative” (named after Simon Bolivar, a fighter for the independence of Latin America in the 19th century), pay for oil in cash, but at the same time enjoy significant benefits compared to other buyers. So far, only Cuba and the two poorest countries in the region - Bolivia and Nicaragua - are participating in the “Bolivarian” scheme.

Petrocaribe summit participants noted with satisfaction the depreciation of the US dollar due to rising international oil prices. In the final statement, they expressed support for Bolivian President Evo Morales, who is now fighting the opposition in an attempt to reform the constitution. And at the same time they pointed out the need to create a “strategic energy security plan” for the region, clearly hinting at the United States.

Cuban leader Fidel Castro was not at the PetroCaribe summit. He has not appeared in public for more than a year and a half, having transferred all representative powers to his younger brother Raul, vice-president of the State Council and commander of the army, in July 2006 . Perhaps it was about Raúl as the successor to power that 81-year-old Fidel Castro spoke the other day in one of his written speeches published by the Cuban media: “My elementary duty is not to cling to posts, and especially not to block the path of younger people, but to bring experiences and ideas, the modest significance of which stems from the exceptional era in which I was privileged to live.” Raoul is now 76 years old.

Director of the Center for Political Research at the Institute of Latin America of the Russian Academy of Sciences, Marina Chumakova, noted to Vremya Novostei that with the help of Petrocaribe and “Bolivarian” hydrocarbon trading schemes, Chavez is “trying to build his empire.” According to the expert, participation in the oil alliance allows participating countries to take advantage of low prices for Venezuelan oil and significant payment benefits, “and such conditions are difficult to refuse.” “The process of economic and political integration of the countries of the Latin American region, controlled by Chavez, is unfolding: Nicaragua is still just a territory of Chavez’s influence. Cuba is economically very dependent on Venezuela. The Venezuelans are building military bases along the perimeter of the Bolivian border.” Soon, Ms. Chumakova suggests, Argentina and Ecuador may join the “Bolivarian alternative,” since “the new Argentine President Cristina Fernandez de Kirchner has common interests with Hugo Chavez, including in the oil industry, and Ecuadorian President Rafael Correa is already ideologically together with Chavez.”

Nikolay GOLYGIN