Reply #33: Venezuela Tensions Worry Oil Executives [View All]

http://www.nytimes.com/2005/01/25/business/worldbusiness/25oil.html?oref=login

OUSTON, Jan. 24 - Venezuela may be increasing tension in energy markets with decisions that are confounding international oil companies, but the government there says it is merely seeking more income and new markets for its oil.

Peter J. Hill, chief executive of Harvest Natural Resources of Houston, which gets all its oil from Venezuela, has one view of the policies unfolding there. Harvest's stock lost a quarter of its value last week after the Venezuelan national oil company unexpectedly told it to suspend exploration.

ConocoPhillips's plan to develop a new oil field in Venezuela was suspended about two weeks ago, and Rafael Ramírez, the Venezuelan energy minister, said last week that the government would review its 33 operating agreements with oil companies from the 1990's to see if they still made sense for Venezuela.

Those delays come as officials, over the last month, have held talks with government-run oil companies from China, Russia and Iran.

"I'm a businessman and I don't like to get involved in politics," Mr. Hill, whose company has operated in Venezuela for more than a decade, said in an interview. "But there's been a demonstrable change in the way things are done in Venezuela."

The view from Venezuela is different. The government of President Hugo Chávez has said it will negotiate its disputes with Harvest and Conoco to reach agreement on production and spending. But analysts say that at a time of high crude oil prices worldwide and a shift in attention toward China, the Venezuelans are also trying to exert greater control over their resources and expand their range of buyers - as well as get more lucrative deals. :eyes: And there's a problem with that? Isn't that capitalism at it's finest?

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