[CubaNews] Opposition politicians challenge Cuba oil sales in Venezuela Supreme Court....

Fred Feldman ffeldman at bellatlantic.net
Mon Aug 26 03:12:22 MDT 2002

The following is an item on the latest step in challenging the Chavez
government's oil agreement with Cuba in the Supreme Court, which was sent to
the CubaNews list by Matthew Dubuque, another in the probably steadily
growing number of people who are making an effort to stay on top of
developments in the struggle in Venezuela.  The introductory comments in
parentheses are by Dubuque.
Fred Feldman.

(Condy Rice and the Bush wrecking crew have two goals in mind in their
crusade to depose the democratically elected President Chavez:

1.  Cut off the oil to Cuba and increase the punishment of the Cuban
people for their unwavering support of President Castro, and

2.  Guarantee a cheap source of Venezuelan crude so that they can
butcher civilians in Iraq and improve the geographic positioning to
suck the oil from the the Arabian Peninsula, the TransCaucasus and
Central Asia.

Note that when Chavez recently came to power OPEC oil sold for $9 a
barrel.  Under the guidance of Chavez [Venezuela currently holds the
rotating chair as the head of OPEC] OPEC established a "fair trade"
policy for oil with a target price of 22-26 dollars per barrel.

Conceptually this is similar to the fair trade debate for coffee
whereby the goal is to set BOTH a floor AND a ceiling on a commodity
price.  In doing so, many members of OPEC are now grateful to Chavez
for developing a coherent strategy to 1) immunize OPEC governments
from wild price swings and 2) provide a reasonable price for their

At first this policy was controversial within OPEC and the oil
producing nations of Norway, Mexico and Russia.  Price "hawks" like
Iran, Iraq and Russia [not an OPEC member, but a major producer]
wanted to extract as high a price as possible for oil and certainly
wanted to establish intermediate targets of $35 a barrel.  But Chavez
persuaded them that this was not sustainable and the oil markets have
been much more favorable to the producers since his "managed float"-
type policies were implemented.

However the oil oligarchs, the putrid barons who continue not to pay
their fair share towards social development costs with their
insistence on withholding oil proceeds from the government, wanted to
lower the price of oil and increase market share, a policy that
failed for the Saudis during the 1980s.

And this was one of the crucial demands of those dissatisfied with
Chavez' regime.  Indeed you will recall that THE major demand of the
general strike which preceded the putsch was the reinstatement of
the head of the state oil company.

Now, the lines are drawn in the sand.  The oligarchs, emboldened by
their recent victory in the Supreme Court, are attempting to use it to
challenge lawfully bartered contracts which Chavez has entered
into with Cuba for oil.

Venezuela needs more doctors, not more capital for Viagra capitalists
only seeking to line their own pockets at the expense of Venezuela's

Here is the story below.

Stay tuned.  The next 60 days THE battle in Venezuela will be waged
in the chambers of its Supreme Court [which, incidentally the junta
leader abolished without notice during his 2 day tenure...])


Venezuelan lawmakers ask Supreme Court to annul oil pact with Cuba

Associated Press, August 22, 2002 Thursday 3:47 PM Eastern Time

CARACAS, Venezuela--A group of opposition lawmakers asked the Supreme
Court on Thursday to annul an oil assistance pact with Cuba.

Rafael Octavio Rivero, of the Social Christian Copei party, said the
pact is illegal because President Hugo Chavez's government failed to
seek congressional ratification before signing it in October 2000.
The Supreme Court is considering a similar case introduced earlier
this year by another group of opposition politicians.

The Chavez-dominated National Assembly voted in 2000 that the pact
didn't require congressional approval because it was the continuation
of a 1992 pact with Cuba. Rivero argued the 1992 pact also lacked
congressional approval and that it involved science and technology,
not oil.

Under the 2000 pact, Venezuela sells 53,000 barrels a day of oil to
Cuba under preferential financial terms. It has similar deals with
other Caribbean nations.

Venezuela provides one-third of Cuba's oil imports. Chavez considers
Cuban President Fidel Castro a close friend and has tightened
relations with the communist island.

Executives at the state-oil monopoly Petroleos de Venezuela suspended
shipments to Cuba during an April coup that briefly ousted Chavez,
arguing Cuba owed dlrs 142 million in the deal. After Chavez regained
power, PDVSA President Ali Rodriguez ordered that shipments resume in
September and allowed Cuba more time to pay the debt.

Edgar Paredes, a top PDVSA executive, publicly criticized the deal
this week, saying Cuba's "high levels of debt" were harming the oil
company's finances.

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