Vzla: Chavez agenda

[A]s Americans complain about the price of gasoline, the Venezuelan government insisted that Opec should cut production. Reuters reports that “OPEC's decision to cut oil production in April is firm and should be respected, Venezuelan Energy Minister Rafael Ramirez said Monday as he insisted cartel members should stand fast on the move.” Needless to say, Opec’s decision to cut production by one million barrels upset the US government. “The U.S. administration said last week it was disappointed with the cartel's move to reduce production. U.S. lawmakers have accused OPEC, and the Saudis in particular, of gouging American consumers at the gasoline pump.” The Venezuelan government also depends on high oil prices for its social spending. Bloomberg News interviewed several sovereign investors who said that they remained bullish on Venezuela as long as oil prices remained high. “As long as the oil price is high and reserves are stable, we're bullish on Venezuela,” said Belinda Van Wyk, who helps manage $650 million of emerging market debt, including Venezuelan bonds, for Rand Merchant Bank in South Africa.” Others were more blunt. "If oil prices or production fall sharply, the government could very easily default,'' Richard Francis, associate director of sovereign ratings at Standard & Poor's "I don't expect oil prices to fall dramatically within the next year so the government is in a good position for now.'' Chavez knows he needs high oil prices to succeed.

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