Hugo Chavez's Most Dangerous Enemy? It's Chavez Himself
By Ian Bremmer
In proven and unproven reserves, Venezuela is believed to control some 270 billion barrels of oil, the deepest supply in the world. As crude prices lurch toward $100 per barrel, President Hugo Chavez would appear to hold the only weapon he needs to further tighten his grip on domestic political power and extend his foreign-policy influence. But a close look at how his government milks the country's cash cow suggests he has serious cause for concern.
Chavez remains popular at home, but if Venezuela's economy turns south and state spending on popular social programs is substantially cut, he may not be popular for long. His fortunes increasingly depend on the future of Venezuela's oil production, because the government's cash comes almost exclusively from the country's state-run energy giant, Petróleos de Venezuela (PDVSA).
First, during a power struggle with Chavez in 2003, PDVSA's workers went on strike. The president retaliated by firing 18,000 of them, including the vast majority of the company's most talented and experienced engineers. Nearly five years later, the company has yet to recover from the loss of expertise.