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Venezuela Nationalizes Oil Field

Hugo Chavez makes good on his promise to nationalize the oil fields in Venezuela.  And he declares that the operation will no longer be open to foreign investment. If the Venezuelan group now in charge had the resources of Exxon, Conoco, Total, et al, that might work, but of course they don’t. 

Frankly from a socionomic standpoint, this looks more like a near top of the market move.  Takeovers were not happening at $30 oil but are happening at $65 oil.  The Saudis have never been able to run their fields, Mexico is actually experiencing reduced production as it soo will not allow foreign investment thru PEMEX. So this is another socialist boondoogle doomed to fail, and coming at what we now suspect is near the top of the oil market.  Capitalism works, period.

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4 responses to “Venezuela Nationalizes Oil Field”

  1. Jordan McClary Avatar
    Jordan McClary

    how come these meatheads can’t get this through their heads? What makes their leadership skills any better then Marx the freaking man who started the whole socialist Ideals. where are thsoe countries today? most of them struggling to survive and some have switched back to a capitalist government. I mean good lord even China has finally realized the potential of a capitalist economy. I read somewhere that these guys were wearing shirts that said Nationalize or Death… I guess they are going to choose death. I mean what do I know I am just a first year grad student, and I could peace all this together.
    Jordan

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  2. Dennis Elam Avatar
    Dennis Elam

    Well this has been going on in South America ever since the Spainards started killing the Aztecs. And as you say it has never worked. One does wonder why no one asks that obvious quesiton, haven’t we tried this before. but Chavez has been clever at spreading the money around with subsidies and so he is liked. AS I said, this looks like it is closer to the top of the oil market than we may have thought.

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  3. Jason Raper Avatar
    Jason Raper

    This is so scary that it makes even a stronger arguement towards the fact that…..we must find some solid way to not become so dependent on foreign oil reserves.
    When you think OPEC you think Middle East not S. America, but Venezula is a premier member. The first rule of the Communist Manifesto is to disarm the people. Chavez is disarming his entire country by doing this, and if he idolizes Castro then he is going to end up like Castro; a country isolated with very little political and econiomic support.
    I guess if you live in a third world country and you have nothing, socialism/communism (they are closely related) may look like an alternative to nothing. I can see how repressed people can be “brainwashed” into its extremes and ideals. But none of them know the differences that capitalism can offer. It is not perfect but it is the best system around.

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  4. Dennis Elam Avatar
    Dennis Elam

    One hundred years ago T Roosevelt observed that S American might amoutn to something if it were the United States of South America. It wasn’t then, and it is not how. And should the price of oil drop back to $40, their economy will collapse again. Hugo of course is not using the oil wealth to encourage investment, he is using it to discourage investment in VZ by naitonalizing the filed. So more investment money will leave the country making certain there will be evev less diversification when the price finally drops.

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