I Daniel ellinger
Venezuela anks sixth in the $/orld n proven eserves f conventionalcrudes, with 78 billion barrels.'235 illion barrels of heavy il (at an eightpercent ecovery ate) n the Orinoco ar belt can be added o this total. At a30 percent rate of recovery the oil ministry estimates Venezuela's otalreserves t 7oo billion barrels, more than proven eserves n the entireMiddle East. mpractical oday, such reserves might become attractive fmost global oil fields have passed peak" ates of recovery global demandcontinues o increase, nd echnological mprovements n emulsifying heavyoils are made. In addition, Venezuela as he world's ninth largest eserveof natural gas, railing only the US in the Western hemisphere. Venezuelaconsistently anks n the top five exporters f oil to the US market.Oil powers Venezuelan iplomacy. Deliveries of oil on credit helpedArgentine President Nestor Kirchner ace down the
International MonetaryFund n zooj-o4. Venezuela xperts are advising other latin governments,including Colombia and Bolivia, on contracts with foreign investors. Oilmoney funds Telesur, a Venezuelan-initiated, emispheric elevision net-work. Petrosur s Venezuela's ffort o create South American oil company;PetroCaribe rovides discounted il to countries n the Caribbean asin. Oildiplomacy has helped Châvez obstruct he US initiative for a NAFTAJikefree trade area of the Americas and promote his "Bolivarian alternative orthe Americas," which prioritizes social objectives nd regional ntegration.
VENEZUELA AND GLOBAL OIL REGIMESVenezuela's leadership in shaping third world oil policies arose in part from
the consequences f the Mexican revolution. Mexico was the first thirdworld country to nationalize oreign oil companies in 1938), but conse-quently he foreign maiors excluded PEMEX production rom global mar-kets until the r97os, when Mexican oil was welcomed back as part of aneffort to counterbalance he Organization of Petroleum ExportingCountries OPEC). n 1943, because f political space pened y Mexicannationalization, he companies accepted new oil law revising generousconcessions f the past and acknowledging hat their profits are subject oVenezuela's overeign owers of taxation. A few years ater, he Venezuelangovernment and Standard Oil agreed o stabilize each side's share of prof-its at 50 percent. American companies romoted his "5o-5o" agreement
t Estimates vary. Unless otherwise noted, all data here compiled by the energy nformationagency f the US Energy dministration.| 56 | f nternational ournal I Winter zoo6-zoo7 |
This contcnt dorvnloaded rom I 93.54. 10.35 n F.i. 3 1 Jan 20 4 03: 4:57 AMAll use subjcct o JS'|OR'l'enns and Corditions