Caracas (Platts)--11Feb2008

Venezuelan President Hugo Chavez Sunday threatened to cut the supply of
crude oil to the US, accusing Washington of being behind the recent measure to
freeze bank accounts and assets of state oil company PDVSA in a row with US
giant ExxonMobil.
"Here I am addressing the American Empire, because you are really the
master (behind the decision to freeze PDVSA's assets). Keep it up and you will
see that we will not be sending you a single drop of oil, the United States
Empire. And I have already instructed oil minister Rafael Ramirez," said
Chavez in his weekly radio and television program.
Chavez spoke after his return from a lightning visit to Cuba, delving
long and loud as to what he thinks are the real reasons behind orders by US
and European courts to freeze $380 million in cash and several more billions
in Venezuelan assets in the US, the US Virgin Islands, Scotland, the Dutch
Antilles and Germany.
ExxonMobil on February 7 said it obtained the court orders to aid its
arbitration case against PDVSA, which was spurred by Venezuela's
nationalization last June of ExxonMobil's holding in a heavy oil project in
the country's Orinoco belt. The US major refused to renegotiate its 41.7%
ownership stake in the Cerro Negro project to give PDVSA a greater share, and
pulled out of the country.
Ramirez last week blasted ExxonMobil, saying the company was not
respecting the arbitration process and was "going against" the sovereign
interests of Venezuela. He also said PDVSA had hired lawyers in the US to
fight the court orders, which prevent the company from selling assets worth up
to $12 billion.
"They believe they are the owners of the world, so a court there orders
Venezuela's whatnot frozen. Well, if you hurt us, we will hurt you back. How?
By not sending you oil. And you can write that down Mr. Bush, Mr. Danger,"
Chavez said.
Chavez often likens the US President to "Mr. Danger", a main character in
classic Venezuelan novel Dona Barbara. As described by author and
ex-President Romulo Gallegos, Mr. Danger negatively portrayed US geopolitical
ambitions in 1930s South America.
OPEC producer Venezuela depends on the US for about 50% of its total
crude exports, amounting to more than 1 million b/d, according to 2006 data
from PDVSA.
Chavez also criticized what he called Washington's "puppet," referring to
ExxonMobil as "imperialist, white-collar thieves that supported the Iraq
invasion..."
--Carlos Camacho, newsdesk@platts.com