Venezuela has been living in a continuous and stable democracy since January 23, 1958 when dictatorship regime of Marcos Pérez Jimenez fell down. But when Lt. Cl. Hugo Chavez took power on February 1999, he started a series of "revolutionary" changes on politics, economics, social and constitutional areas to create what he call "The Fifth Republic". In the last year, President Chavez has been promoting changes on the changes he already did and now, several persons (including politics and economics analysts) have critiqued Chavez new politics as they claim he is on a way to set up a totalitarian Marxist-Leninist regime.

Chavez oil

Venezuela and Oil:

Venezuela oil industry has its roots in Venezuela on 1914, when it was discovered the Mene Grande field in Lake Maracaibo's east coast on Zulia State; and its oil opened the world energy markets to Venezuela. Subsequently Venezuela became an important allied for crude oil importers because the country had a stable democracy and is not located on the unstable middle-east. Venezuela became an important figure in oil business as a founding member of OPEC (Organization of Petroleum Exporting Countries), and expanded its energy services outside the country, with the adquisition of CITGO in United States. In the 1990s, Venezuela introduced a new oil policy known as "Apertura Petrolera", which opened its upstream oil sector to private investments, like Exxon Mobil.

Chavez Oil relationship:

1990's policy changed after Hugo Chávez took the presidential post in 1999, and specially when the oil prices received the impact of 9/11 consequences, including the war on Iraq that provoked oil prices started an unstoppable increase. In recent years the Venezuelan government has reduced PDVSA oil company's previous autonomy and amended the rules regulating the country's hydrocarbons sector. In 2001, Venezuela passed a new Hydrocarbons Law that superseded the previous 1943 Hydrocarbons Law and 1975 Nationalization Law. In 2006, Venezuela government announced a new nationalization of oil industry, forcing foreign oil company with assets in the country, like Exxon Mobil, Conoco Phillips and Chevron to share big stakes with PDVSA.

Citgo

Chavez is also giving special importance to CITGO as it is a Venezuelan operated oil company in a country which Chavez doesn't get on well with. The Venezuela government started using CITGO to make political points against the current US administration with social plans, like the Chavez oil program, to bring heat to poorest in winter.

During his presidency, Hugo Chavez has giving special importance also to OPEC cartel. He has been promoting meetings between OPEC members to regulate oil production. This caused some controversies in 2000 when he decided to have some encounters with Saddam Hussein as Iraq is a member of OPEC. He also keep having meetings with other controversial leaders, like Iran's Mahmoud Ahmadinejad, Libya's Muammar al-Gaddafi and Algeria's Abdelaziz Bouteflika (all OPEC members).

OPEC

Wikipedia

Answers

IHS

IHT

El Universal

Belfast Telegraph

The new Chavez oil nationalization expanded to other sectors and, on January 2007, Chavez announced he would send to the National Assembly a new enabling act, asking for the authority to re-nationalize the biggest telecom company of Venezuela (CANTV), and other companies from the electrical sector, all previously public companies which were privatized by past administrations.

On August 15, 2007, Chavez proposed a new constitutional reform, which he called for an end to presidential term limits to extend his rule. He proposed eliminating central bank autonomy, strengthening state expropriation powers and giving himself control over international reserves. He also warn all Venezuelan private banks to accept his socialism or he will take control over them. Other announces was the creation of "Militias" and changes on Venezuela time zone.

In the end, Chavez oil politics caused some foreign companies and investors, like Exxon Mobil, decided to pulled out from Venezuela.

For additional information about Venezuela government latest actions and decrees, Chavez oil politics, social situation and protests, check our Venezuela news archive page.