Vainglorious Sanction Victimizes Venezuela Oil

Oil fuels logic for the Empire. Now, the Empire finds that imposition of sanction is needed against Venezuela’s oil company. The logic is: the Bolivarian country has entered into an oil deal with Iran, the theocracy run state, where a group of guardians determine democracy’s limit.

James Steinberg, the US Deputy Secretary of State, announced: Secretary of State Hillary “Clinton has decided to impose sanctions on seven foreign entities under the Iran and Libya Sanctions Act of 1996.” Venezuela’s state –run Petroleos de Venezuela SA (PDVSA), the world’s most revolutionary oil company is one of those seven.

The US claims: PDVSA has delivered at least two cargoes of reformate, a gasoline blending component, to Iran between Dec. 2010 and March 2011.

President Hugo Chavez’s government condemned the sanctions, which will be effective for two years. “Sanctions against the Fatherland of Bolivia? Imposed by the Gringo imperialist? Well, welcome Mr. Obama, don’t forget we are the children of Bolivar!” Chavez said via his Twitter account. The Venezuelan government criticized the US step calling the sanctions an “imperialist attack” against Venezuela. It condemned the US decision as “it represents a hostile action, is in breach of international law and violates the principles of the Charter of the United Nations.”

Rafael Ramirez, the Venezuelan oil minister informed that PDVSA’s shipments of heavy crude to its US subsidiaries will continue. However, shipments to nonaffiliated private oil companies are not guaranteed. He rejected the imperialist interventionism. “Imperialism is not to decide who will be Venezuela’s friends. Their imperial decisions will neither hit nor stop us. PDVSA is ready to fight for sovereignty,” he added. According to Ramirez, the OPEC is under attack by the US. Venezuela’s industry has the capability to face and overcome this sanction, said Venezuelan Foreign Minister Nicolas Maduro. He assumes that mostly US business using Venezuelan oil will be affected. In a press conference he said: “We are not afraid of these sanctions, nor are we going to debate the reasons that the North American government may have, but Venezuela is sovereign in making its decisions.”

An official document rejecting the sanctions was drafted and signed by pro-Chavez Venezuelan ministers, but opposition politicians refused to sign it. “This shows once again that these politicians are representatives of North American imperialism,” said Ramirez.

In a statement the Venezuelan government said that it would assess the situation to determine the ways the sanctions could affect the operational capacity of the country’s oil industry. Shipments of crude oil to PDVSA’s US subsidiaries are ensured. But supply to clients other than Citgo, the subsidiary, is under discussion. Average shipments of Venezuelan oil amounted to 987,000 bpd in 2010. Venezuela ships about 45% of its crude to the US that makes up about 10% of US oil imports.

Venezuela National Assembly has approved by absolute majority an agreement to refuse the sanctions. The Assembly considers the sanction as “an unprecedented hostility act in US-Venezuela relations.” The Assembly has urged the Venezuelan government to take “reciprocal measures, in proportion to retaliation against the United States,” within the framework of Venezuelan regulations and international law. The Venezuelan Oil Chamber condemned the sanctions. The Venezuelan-American Chamber of Commerce and Industry (Venamcham) expressed its concern over any sanction that may damage trade between the two countries.

Oil industry workers rallied in front of oil facilities in the states of Falcón, Zulia, Monagas, Anzoátegui, Carabobo, and other states and in the Capital. They took part in demonstrations, take-overs of oil refineries, cultural activities and convoked a popular assembly in order to manifest their support for the government’s foreign policy. Women and peasant organizations, alternative media, and community councils also organized marches in Caracas in response to the sanctions. Many Venezuelans consider that the US is trying to “organize another right-wing offensive against the processes and countries which are currently liberating their own people”.

The sanction, largely symbolic, will also affect six other smaller companies in the UAE, Israel and Singapore.

The sanctions will not affect PDVSA’s capacity to sell crude oil to the US. It will prohibit PDVSA from competing for US government contracts or getting US export financing, any transactions in foreign currency from PDVSA that are subject to the jurisdiction of the US, and any transfers or credit or payments between financial institutions where PDVSA is involved. The sanctions confirm the US effort to escalate its Iran-initiative. Moreover, it expresses energy imperialism’s enhanced efforts to destabilize and interfere in energy-rich and strategically located countries.

But because of sociopolitical perspective and the ongoing economic-political transformation Venezuela is neither Libya nor Syria. The organizational innovations and initiatives, despite weaknesses, by the people and the country’s geopolitical moves make Venezuela a difficult piece to swallow.

The sanction is an effort by the Empire to hurt Venezuela economically, and a threat. “The U.S. needs to move quickly to cut off Chavez’s source of revenue, and bring an end to both his influence in Latin America and his dangerous relationship with the terrorist-supporting Iranian regime before it’s too late,” said Connie Mack, US Congressman and Chairman of the Subcommittee on the Western Hemisphere.

In the energy front, Venezuela has diversified its sources for technology supplies. Financially, it does not depend on the US or on any of its companies. China is accelerating its steps to get supply to its increasing oil thirst with Latin American oil. This carries all the possibilities of costing the US. According to the Energy Tribune, the Chinese secured deals throughout Latin America in 2010 worth at least $65 billion in stakes of projects that could eventually produce over 1.3 mbd crude oil. Most of China’s Latin American oil investments are in Venezuela. China is planning an oil refinery in Venezuela and has rented a 5 mb storage facility in the Caribbean. A major obstacle for China is to economically ship Venezuelan oil to its own land. To overcome the obstacle, China plans to construct a railway, dubbed as land-based Panama Canal, across Colombia, from the Atlantic coast to the port on the Pacific coast, which will allow China to ship oil and coal from eastern Colombia and Venezuela to Pacific ports. From these ports the energy material can be shipped to China. This project, after completion, will significantly transform energy politics in Latin America. During his 2004 China visit, Chavez told that his country was ready to help China establish its own strategic petroleum reserve.

Chavez played the central role in inking the agreement that will allow Manuel Zelaya, the president of Honduras overthrown in a coup in 2009, to return home. Zelaya and Lobo, the current president of Honduras, signed the agreement. Chavez, Santos, and Lobo met in Colombia to discuss the agreement. Before to that discussion, Chavez discussed with Zelaya in Venezuela. It is a major achievement by Chavez in Latin America’s struggle for democracy, which is opposed by its powerful northern neighbor.

In home, significant initiatives are being taken by the Venezuelan people. In late-May, workers’ council delegates from most of Venezuela’s 23 states met in Puerto Ordaz with the aim of advancing the organization of the management model of Socialist Workers’ Councils, analyze progress, strengths and weaknesses of worker control in Venezuela, and to “strengthen the struggle for productive independence through worker control”. The Organic Law of Popular Power recognizes Socialist Workers’ Councils providing these councils the legal basis. Slogans of the conference included “Neither capitalists nor bureaucrats, all power to the workers”, “Without workers’ control there’s no revolution”. In late-March, thousands of Venezuelan workers took to the streets of Caracas to demand immediate improvements in workplace democracy and the final passage of a radical new labor law. The marchers extended “critical support” to the government of Chávez and pushed for consolidation of Chávez proposed “21st century socialism” on job sites nationwide. The rally condemned the state bureaucracy, widely considered as a major roadblock to the advance of the revolution in general.

These developments strengthen Venezuela’s position in home and on international arena. Vested interests and their masters make all out effort to hinder Venezuela’s journey to peace, prosperity and dignity. Energy imperialism increases this danger.