Post by Papa C. on Feb 13, 2008 12:51:15 GMT
Venezuela breaks ties with Exxon
news.bbc.co.uk/2/hi/business/7242133.stm
Venezuela's state oil company PDVSA has announced it is suspending sales of crude to Exxon Mobil, in response to legal action brought by the US firm.
President Hugo Chavez has said he will no longer do business with Exxon which he says is not welcome in Venezuela.
Exxon wants compensation following the nationalisation of a project in Venezuela's largest oil reserve.
The firm receives only about 2% of its supply from Venezuela, but PDVSA's decision could cause it problems.
Frozen assets
This is a fight between two giants - Exxon Mobil, the world's largest private oil firm, versus Venezuela's state energy company.
A recent court ruling freezing some Venezuelan assets in the country's Orinoco Belt, pending arbitration has outraged President Hugo Chavez.
He has accused Exxon of plundering the nation's resources, claiming their action is part of a wider economic war backed by the US government.
Mr Chavez has retaliated by cutting oil supplies to the company as well as all commercial relations.
The amount is not huge. But the move does put an end to any hopes the company had of negotiating with Venezuela and returning to future projects.
Meanwhile, Mr Chavez is still threatening to cut supplies to the United States if Venezuelan interests are adversely affected by legal action.
