RUSSIA AND VENEZUELA: MUTUAL ATTRACTION OF TWO OIL GIANTS

[bemildred]

If you listen closely, you can hear them gibbering about this
in the State Dept.

Moscow, (Vasily Zubkov, RIA Novosti economic analyst) - Moscow is preparing to welcome Venezuelan President Hugo Chavez. His upcoming talks with his Russian colleague, Vladimir Putin, have already evoked much interest in the world. Venezuela and Russia are rich in hydrocarbons and pursue independent oil policies because they are not members of OPEC. Venezuela, the 5th largest oil exporter, produces 3.1 million barrels a day and Russia, the 2nd largest oil exporter, produces 9.33 million barrels a day.

The approaches the two leaders, who are popular in their countries, have taken to reinforce the state's role in the energy sector have some similarities. Chavez said that a recent 16-fold tax hike (from 1% to 16.6%) for foreign companies and joint ventures producing oil in Venezuela was the start of the second phase of the nationalization of oil industry. Its motto is: the energy sector should be more involved in modernizing the entire national economy. The United States imports 15% of its crude from Venezuela and Venezuela has the largest explored reserves in the Western Hemisphere (77 billion barrels).

General Chavez's idea to create an inter-American oil company to export refine products rather than crude, is also popular in Latin America. In the Venezuelan leader's opinion, over $100 per barrel should be the fair price for oil.

In Russia, with Putin's approval, the gas giant Gazprom is merging with another company to form Gazpromneft, a large oil company. After the Kremlin won the Yukos affair, which concerned billions of dollars of back taxes, Yukos - the largest Russian oil producer - is on the verge of bankruptcy and its production units are about to be put up for sale to repay its debts. Most Russians view the Kremlin's victory in the Yukos affair as a victory for Putin in his fight with the Russian oligarchs.

Novosti

[hedda_foil]

1. We are in such deep shit!

Thanks, Chimpster. Thanks a LOT.

[aneerkoinos]

2. Correction to article

Venezuela is very much member of OPEC.

[AP]

3. Am I having a brain fade? Venezuela is an OPEC member, isn't it?

[bemildred]

4. Was the chair for a while.

But hey, it's a Russian web site.
They are wild and crazy guys.