Oil troubles for Chavez in Venezuela


Venezuela's generals have announced that troops, along with helicopters and patrol boats, have been rushed in to troubled Zulia state in the west to combat 'CIA sabotage.' It sounds like martial law. 
Venezuela's west is full of oil workers. The Lake Maracaibo area in Zulia state is a critical oil producing area. It's also the most dangerous, rebellious state in the entire nation for dictator Hugo Chavez. It's one of two states so anti—Chavez that it has an opposition governor. Chavez didn't dare stack that regional election in Zulia last Oct. 31.
Like a heavy sea, there has been something churning under the ooze there for some time. The gigantic Paraguana refining complex in Zulia, capable of producing nearly a million barrels of oil a day, saw a key refinery, Amuay, shut down last month due to an 'electrical shortage' amid rumors of oil worker sabotage. Normally, a refinery shutdown should take one or two days to fix. It took two weeks. That shutdown rocked world oil prices.
Now, there are rumors of firings of 12,000 oil workers, following the firing of 40 managers, contributing to potential labor unrest. Some of the workers hired, according to Veneconomy, were hired as contractors just before the recall referendum last August, as part of Hugo Chavez's spoils system to ensure their votes.  Having consolidated power, perhaps he doesn't need them any more. There also are signs of vast corruption in the looting of the oil company.
A congressman has called the situation of the state oil company in Zulia 'anarchy.' He demands that the oil executives, all ignorant political hacks who have looted the company on an untold scale, be fired.  Venezuela's generals have been making statements about the unstable situation. In a menacing sign, Fidel Castro of Cuba has just announced a new shipyard construction project in Venezuela, bringing on Cuban workers. Considering their trade, may well be 'enforcers.'  Furthermore, their new presence will displace Venezuelan oil workers, a development sure to create resentment amid mass firings.
The workers, whom the government calls 'contractors' may be fired because oil production has slid to alarmingly low levels. Barges are out of service and pumpjacks are rusting in the fields. All this while world oil prices are at record highs. Even the government is admitting as much.
The soft—focus Venezuelan Information Office propaganda about how Venezuela's oil earnings have been sent to social welfare programs may well have broken the bank at the refineries, which are starved for investment, to the point of being unable to produce oil. This is happening as foreign oil investors are being abused and chased out of the country as enemies of the state. The EFE news report, above, reports that Chevron Texaco shut down its oil operation in Zulia last week. Reasons unknown.
There are other murky developments, particularly in the signs of political turmoil noted here but one thing is certain: angry oil workers with their fingers on the production buttons are a major threat to Hugo Chavez, whose only existing political support now is in his ability to buy off shantytowns with his social programs. He can satisfy them or he can satisfy the oilers but apparently he can't do both. Perhaps he cannot even do either. This may be big trouble brewing for Hugo Chavez.
A.M. Mora y Leon 05 05 05