Shouts of “Long live President Hugo Chavez! Long live socialism!” filled a Caracas plaza January 31. Venezuelan lawmakers had just turned over much of their authority, giving the president the right to rule by decree for 18 months. Chavez can now remake 11 broadly defined areas of society, ranging from the economy to the justice system.
Among the policies Chavez plans to use his new powers to impose is the nationalization of major oil projects in the Orinoco basin, which foreign companies have heavily invested in. Estimates of the amount of oil in the basin run around 1.3 trillion barrels. Analysts believe that 300 billion of those barrels are recoverable with today’s technology, which would give Venezuela the world’s largest oil reserves.
With the U.S. importing more than 10 percent of its oil from there, the nationalization of Venezuela’s oil industry threatens the U.S. energy supply—if one believes Chavez’s anti-American rhetoric and stated desire to sell his oil elsewhere.
The U.S. says it is concerned and is working to ensure democracy’s survival in Venezuela, but its efforts have thus far failed to hold back Chavez.