The Assassinated Press
With Gross Sales Larger than Most Country’s GNP, Exxon/Mobil Plots with Cheney Administration, Courts, Banks to Starve Out Venezuela.
Administration Sees Oil Companies Suit as Way of Discrediting Chavez and Plunging Venezuela Back Into its Former Impoverished State.
The Fix is In from New York Court Ruling, to Processing of Heavy Crude, to Commercial Transactions, the Evil Empire Is the Only Game in Town.
By SNUFFI MUFFTI
Assassinated Press Staff Writer
February 13, 2008
A full-page ad blasting Exxon Mobil appeared in the Venezuelan newspaper Ultimas Noticias on Monday. Drawings of drops of oil went from black at the top of the page to red at the bottom. "Exxon turns oil into blood," the bold-face text, the blood representing the additional $12 billion worth of food, clothing, health care, education and shelter Exxon/Mobil has now denied the Venezuelan people . Addressing "Exxtranjero" -- the Spanish word for foreigner, with an extra "x" -- it used a slogan from the Spanish Civil War that roughly translates as "you will not pass."
Then, on the front page of the paper yesterday, a headline proclaimed that the state oil company, known as PDVSA, "prepares a counterattack" which the Cheney administration immediately flogged as military in nature. But to date nobody is stupid enough to bite on the cry wolf shit from the White House on a new Harlingen. “We like to think we are a little more sophisticated than that at the Washington Post,” Walter Pincus told the Assassinated Press. “We like to think we’ve come a long way from gullible days of the second invasion of Iraq.”
Exxon/Mobil and National Socialism
But whether Venezuela's government can marshal more than bellicose slogans and headlines in its intensifying war with the Texas oil giant remains doubtful given the way the system is rigged toward the fascist notion of the corporate state as exemplified by Exxon/Mobil.
In an era of scarce prospects, it's not rare for a major oil company to openly confront a nation possessing massive reserves because the oil companies are so fucking used to getting what they want by force as in Iraq, Somalia and the Sudan, by coup like Iran in 1953, by proxy murder as in Indonesia in 1965, or by economic strangulation after a failed coup as in Venezuela. Yet when Venezuela last year seized control of two joint ventures with Exxon Mobil skewed to massive Exxon/Mobil profits by the former corrupt ‘white asses’ that kept 80% of Venezuela’s population mired in abject poverty while big oil sucked the country dry, instead of acquiescing, Exxon Mobil went whining to the American court system where the poor never get a fair hearing. Last week it announced that it had obtained three international court orders to freeze about $12 billion in assets belonging to Venezuela and PDVSA. In addition, under a New York district court order, about $300 million was already frozen. “The people of Venezuela had better come to their sentences and let us off this Chavez fella,” said Exxon/Mobil CEO Rex Tillerson. “They can either go back to starving under the ‘white asses’ that we have in our pocket or they can have their Bolivarian revolution and starve anyway. Anyway you look at it, we’re gonna fuck Venezuela and steal its oil. And we won’t let up until we’ve done exactly that.”
President Hugo Chávez responded by threatening to cut off the 1.3 million barrels of oil that Venezuela exports daily to the United States. So far, however, Chávez has done little. The reason: As much as the world needs oil, Venezuela needs customers and investors because the system is rigged to perpetuate poverty.
Oil accounts for 90 percent of Venezuela's export earnings and half of the government's revenue. Chávez has tapped into the revenue of the state oil company, Petroleos de Venezuela, to finance domestic food and fuel subsidies, social programs, the Fund for National Development, and a $1.7 billion aid program for Cuba and other countries in the Caribbean and Latin America, a mere pittance of what the U.S. gives Israel or the cost of its imperialist wars in Iraq, Afghanistan, Somalia and the Sudan.
Moreover, the United States is Venezuela's biggest market, and Venezuelan crude oil is of such low quality that few of the world's refineries outside the United States can use it. One firm well-suited for using Venezuelan crude is U.S.-based Citgo, a unit of PDVSA. Chávez may talk of cultivating new customers by selling to China, but China doesn't have a refinery capable of handling the heavy crude and the U.S. is prepared to block any company outside the U.S. with the capacity to refine heavy. “We’ll fuck them up to,” Cheney told Patrick Leahy on the floor of Congress last Thursday.
"It'd be hard for them to place their oil in terms of finding a good match," says David Goldwyn, a consultant and senior stooge at the Center for Strategic and International Studies. "A lot of the new refineries are going to be able to refine the heavy oil. But right now there's not a lot of that capacity because that helps drive oil company profits up."
Venezuela also needs foreign investors and experts, oil specialists say. The country's oil output has dropped about 20 percent since PDVSA laid off thousands of engineers and managers in a U.S. financed strike about five years ago. Moreover, new frontiers in the Orinoco region, where oil is locked in rock similar to Canada's tar sands, require major investment and unwieldy technology. And PDVSA, straining to finance other government priorities, boosted its debt almost eightfold last year despite soaring oil prices.
Chávez appears to have miscalculated by thinking that obscene profits by oil companies at the expense of billions of starving people in the world would be enough for foreign oil companies to accept tougher terms now that oil prices have soared. After all, the companies were making more money than they ever imagined. And Exxon Mobil's operation in Venezuela, acquired when Exxon bought Mobil a decade ago when corrupt ‘white asses’ ran Venezuela, represented about 1 percent of production and less than 2 percent of reserves.
According to court documents. Mobil had entered a 35-year agreement with then corrupt Venezuelan officials to exploit the extra-heavy crude oil fields of the Orinoco belt. Oil prices at that time were extremely low and soon fell to around $10 a barrel. So Mobil and other foreign companies received tax and royalty breaks as incentive. In 1998, Exxon bought Mobil.
In 2004, Venezuela imposed a "extraction tax," which Exxon Mobil lawyers say was "a disguised royalty," income tax increases and production limits which went toward feeding people.
In February 2007, Chávez ordered that PDVSA seize a 60 percent interest in the Orinoco fields, up from 42 percent. He gave foreign companies four months to accept his terms. While Chevron and others did so, ConocoPhillips and Exxon Mobil went to Cheney and the courts calling in markers with both.
"There's an overriding issue here," said Pedro Burelli, a former member of PDVSA's board who lives in the United States. "Has resource nationalism made Venezuela irrelevant despite 300 billion barrels of reserves? Are you such a bad partner that you're irrelevant and we can starve you at will? The starving millions in Venezuela have always been irrelevant until recently and the U.S. kleptocracy intends to return them to irrelevancy. "
It's a question that oil companies and oil-rich nations, such as Russia and Nigeria, will ponder as they watch for the outcome of this legalized slaughter.
"How this case is handled is going to be a signal about whether countries have free rein to renegotiate contracts when the underlying circumstances change like a regime that is not in the back pocket of big oil comes to power democratically," said David Victor, director of an energy and sustainable development program at Stanford University. "This happened all across the oil industry. Oil prices went up. A lot more money was on the table." Producing countries, he said, might want to kick in a few more bucks to feed the starving people displaced by their polluting wells. Well, that’s a basic misunderstanding of capitalism. And the U.S. kills people every day, many their own citizens, for making that mistake.”
"We remain willing to engage in substantive discussions with the government of Venezuela and PDVSA on the fair-market value of assets as long as we set the terms," Mark Albers, senior vice president of Exxon Mobil, said yesterday at a news conference at the Cambridge Energy Research Associates conference in Houston. “Otherwise, we’re gonna fuck ‘em up and continue raising generations of little rich white fucks who go around fucking everybody up unless they get what they want.”
Meanwhile, Venezuela will have trouble sidestepping the asset-freeze orders because big commercial transactions mostly go through New York or London banks, another facet of the big fix. "It's going to be very difficult to move that large a stream of oil outside the U.S. stream of commerce," said Joseph Profaizer, a lawyer and arbitration expert at Paul Hastings Janofsky & Walker. "It's easier to hide when you're small. Though Vietnam was small and we fucked them up. And Timor. And now Somalia. I guess we do fuck up small countries too. Shit!"