Archive for March 14th, 2011

Even $100 dollar oil is not enough for voracious Hugo Chavez

March 14, 2011

As oil prices hit U$100 per barrel, many thought this would be enough to satisfy Chavez’ voracious appetite for sometime.

No such luck.

Yesterday, Chavez said that more money is needed and that he had sent some people to China to negotiate a new loan. Chavez said that he “did some adding” and he realized that he needs more money. “I checked the Housing Mission, we need thousands of millions”

And then the man that has wasted over half a trillion dollars in twelve years dared say: “One has to administer resources with good criteria. We have to save (??). One has to add up the numbers of the country…We have to administer with prudence…we need money for agriculture,roads, schools, hospitals, culture, the armed forces, railroads…”

Chavez sent the Minister of Commerce Edmee Betancourt with representatives from Finance and PDVSA to make a formal request to the Chinese, later he mentioned “one of the largest banks of that country”

It was unclear what happened to the US$ 16 billion left, never disbursed, of the US$ 20 billion loan with China. This is the so called “miracle loan” as Minister of Finance Giordani says these loans can not be considered as debt, in a new and novel interpretation of “debt” under the revolution.

Let’s see. Even if we don’t believe PDVSA’s export numbers and believe ours, Venezuela exports about 1.6 million barrels of oil a day. At US$ 100 per barrels, the Venezuelan basket for the year would be around US$ 92 per barrel, some $25 dollars above last years average, or  an additional US$ 40 million more per day, or an extra US$ 14.6 billion more. But this is not enough for Hugo.

The sad part is most of this money will be used for current spending, not investment, mortgaging the future of all Venezuelans so that Hugo may create a feeling of bonanza and get reelected in 2012. That is all that matters to him.

How irresponsible can you get?

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