Tue, Feb 12, 2008 - Page 7 News List

Chavez threatens 'economic war'

'ALO PRESIDENTE' Accusing ExxonMobil of acting in concert with Washington to 'rob' Venezuela, Chavez said his country, and others, could stop shipping oil to the US


Venezuelan President Hugo Chavez threatened on Sunday to cut off oil sales to the US in an "economic war" if ExxonMobil Corp wins court judgments to seize billions of dollars in Venezuelan assets.

"If you end up freezing [the assets] and it harms us, we're going to harm you," Chavez said, turning his words to US President George W. Bush. "Do you know how? We aren't going to send oil to the United States. Take note, Mr Bush, Mr Danger."

ExxonMobil has gone after the assets of Venezuela's state oil company, Petroleos de Venezuela SA, in US, British and Dutch courts as it challenges the nationalization of a multibillion dollar oil project by Chavez's government last year. A British court has issued an injunction "freezing" as much as US$12 billion in assets.

"I speak to the US empire, because that's the master: Continue and you will see that we won't send one drop of oil to the empire of the United States," Chavez said during his weekly radio and TV program Alo Presidente.

"The outlaws of ExxonMobil will never again rob us," Chavez said, accusing the Irving, Texas-based oil giant of acting in concert with Washington and being part of corporate "worldwide mafias."

Chavez has often threatened to cut off oil shipments to the US, which is Venezuela's No. 1 client, if Washington tries to oust him.

Chavez's warnings on Sunday appeared to extend that threat to attempts by oil companies to challenge his government's nationalization drive through lawsuits.

"If the economic war continues against Venezuela, the price of oil is going to reach US$200 [a barrel] and Venezuela will join the economic war," Chavez said.

"And more than one country is willing to accompany us in the economic war," he said.

ExxonMobil spokeswoman Margaret Ross said the company had no comment. A US embassy spokeswoman in Caracas did not return a call.

The US imported 1.23 million barrels of crude oil a day from Venezuela in November, making it the fourth-biggest source of oil imports behind Canada, Saudi Arabia and Mexico, the latest US Energy Department figures showed.

Those four countries, along with Nigeria, accounted for 74 percent of US crude oil imports in November, the government said. By itself, Venezuela accounted for about 12 percent of US crude imports, the figures showed.

Venezuelan Oil Minister Rafael Ramirez has said that court orders won by ExxonMobil have "no effect" on the state oil company PDVSA and are merely "transitory measures" while Venezuela presents its case in courts in New York and London.

ExxonMobil is also taking its claims to international arbitration, disputing the terms it was granted under Chavez's nationalization last year of four heavy oil projects in the Orinoco River basin, one of the world's richest oil deposits.

Late last night, PDVSA said it had moved its export payment accounts to UBS bank in Switzerland after ExxonMobil secured the embargo.

A central bank director in Curacao said Exxon lawyers had told banks that one of the court rulings meant they had to at least maintain the current level of funds PDVSA holds in any account in the Netherlands Antilles island.

"It all has to go to UBS in Switzerland now," said one trader who asked not to be identified.

Also see: Chavez threatens to nationalize Swiss milk plants

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