Exxon's wrathful tiger takes on Hugo Chávez
A dispute with Exxon adds to the troubles of Venezuela's president and the state-owned oil behemoth on which he relies
AFTER winning a new term as president by a landslide a year ago, Hugo Chávez decided that it would be a nifty idea to squeeze the remaining private oil companies operating in Venezuela. So he ordered the tearing up of the contracts they signed in the 1990s, under which they were investing to develop deposits of super-heavy crude. In their place would come joint ventures in which Petróleos de Venezuela (PDVSA), the state oil company, would wield the controlling share. A year on, however, one of the multinationals, Exxon Mobil, is fighting back. This has prompted Mr Chávez to complain that the United States is waging “economic warfare” against his country. But such fiery talk cannot disguise the fact that both he and PDVSA are in a swamp of trouble.
AFTER winning a new term as president by a landslide a year ago, Hugo Chávez decided that it would be a nifty idea to squeeze the remaining private oil companies operating in Venezuela. So he ordered the tearing up of the contracts they signed in the 1990s, under which they were investing to develop deposits of super-heavy crude. In their place would come joint ventures in which Petróleos de Venezuela (PDVSA), the state oil company, would wield the controlling share. A year on, however, one of the multinationals, Exxon Mobil, is fighting back. This has prompted Mr Chávez to complain that the United States is waging “economic warfare” against his country. But such fiery talk cannot disguise the fact that both he and PDVSA are in a swamp of trouble.
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