August 29, 2005

Venezuela to sell cut-price heating oil to U.S. poor

CARACAS, Venezuela (Reuters) - Venezuela's President Hugo
Chavez said on Monday his government plans to sell as much as
66,000 barrels per day of heating fuel from its U.S. Citgo
refinery to poor communities in the United States.

The offer, made after populist Chavez held talks with U.S.
civil rights activist Rev. Jesse Jackson, would represent 10
percent of the 660,000 bpd of refined products processed by
Citgo. The deals would cut consumer costs by direct sales.

Venezuela's Energy Minister Rafael Ramirez said officials
were still working on the details on how the oil would be sold
from Citgo, a unit of the state oil firm PDVSA.

"We are going to direct as much as 10 percent of the
production, that means 66,000 barrels, without intermediaries,
to poor communities, hospitals, religious communities,
schools," Chavez told reporters at a press conference.

The world's No. 5 oil exporter, oil cartel OPEC member
Venezuela is a key supplier to the United States, providing
about 15 percent of all U.S. energy imports.

But relations between Caracas and Washington have become
strained since left-winger Chavez was elected in 1998 promising
social reforms.

Chavez, a former army officer who survived a coup in 2002,
frequently accuses the U.S. of backing efforts to kill him or
topple his government. U.S. officials dismiss those charges but
say Chavez has become a threat to regional stability.