BASSETERRE, June 13 – Venezuela put on a show of force, spotlighting the success of its oil diplomacy at a summit of Caribbean basin countries that agreed to boost investment and strengthen its oil distribution network.
About 20 heads of state and government met in the capital of the tiny islands of St. Kitts and Nevis for a Petrocaribe summit to broaden the Caracas-funded Caribbean basin energy cooperation.
Venezuelan President Hugo Chavez told members that Caracas can sustain its supply despite the pressures of global financial crisis, promising that the network "will become ever stronger, regardless of oil prices or the international situation."
Upon his arrival in the Caribbean nation, which lies east of the Dominican Republic, Chavez said the world economy was set to contract by 3.5 percent in 2009.
"If it weren\’t for Petrocaribe, most of the Caribbean countries today would be collapsing, they would have no way to confront the storm of global capitalism," he stressed.
Chavez, an elected leftist and staunch US critic, led much of the summitry, as his main Caribbean ally, Cuban President Raul Castro, 78, bowed out at the last minute.
Venezuelan Oil Minister Rafael Ramirez said the meeting agreed to improve the regional distribution network, to expand the refinery in Cienfuegos, Cuba and build a new refinery in Matanzas, Cuba.
"Improving the logistics for distribution of oil in the region has led to an increase in supplies," he said.
Nicaragua plans to boost production at an existing refinery to process up to 150,000 barrels a day, and a new refinery on the island of Dominica will be completed in 2010 and another is to be built in Haiti, Ramirez said.
"In Haiti a new power plant built with an investment of 74 million dollars will cover 17 percent of demand," he added.
At the end of the meeting Friday, Ramirez told AFP that Venezuela had agreed to buy a 49 percent stake in the Dominican Republic\’s refinery.
Only four Petrocaribe members have refineries: the Dominican Republic, Jamaica, Cuba and Nicaragua.
Other member countries receive costlier refined products — diesel, kerosene, gasoline and fuel oil — from Venezuela.
OPEC member Venezuela, which launched Petrocaribe in 2005, allows members to pay for up to 60 percent of their oil with 25-year financing at one percent interest. At the moment Venezuela sells some 200,000 barrels of crude and derivatives to Central American and Caribbean members.
Petrocaribe\’s members include: Antigua and Barbuda, the Bahamas, Belize, Cuba, Dominica, Grenada, Guatemala, Guyana, Haiti, Honduras, Jamaica, Nicaragua, the Dominican Republic, St. Kitts and Nevis, St Vincent and the Grenadines, St Lucia, Suriname and Venezuela.
Venezuela this year expanded membership to include El Salvador, Costa Rica and Guatemala.
The Venezuelan government denies that it could end up influencing the actions of member countries that owe it money, insisting Petrocaribe is only about fairer access to energy.
In the case of Cuba, Venezuela\’s financial and energy support is critical to supporting the Castro regime. Energy dependence has long been Cuba\’s Achilles\’ heel.
Havana used to depend on the east bloc for cut-rate oil, and plunged into economic chaos and blackouts when it was cut off after 1989. Now it depends on crude from ally Venezuela.
Cuba is negotiating oil exploration and production deals with Russia, China and Angola, with Moscow shaping up as the partner that could make the communist island energy self-sufficient, if its untapped offshore reserves pan out.
If it can achieve energy independence, Cuba may in the blink of an eye turn from a cash-strapped developing nation into a flush oil exporter, possibly projecting its current regime years into the future.
Cuban authorities in October announced that the Caribbean nation\’s crude reserves were more than double what had been thought, and now were estimated to be about 20 billion barrels.