Chavez's Financial "Booty" Call

President Hugo Chávez, buffeted by falling oil prices that threaten to damage his efforts to establish a Socialist-inspired state, is having to "eat crow" and beg for foreign investments from western oil companies once again.

Until recently, Chávez had pushed foreign oil companies here into a corner by nationalizing their oil fields, raiding their offices with tax authorities and imposing a series of royalties increases.

But faced with the plunge in prices and a decline in domestic production, senior officials here have begun soliciting bids from Chevron, Royal Dutch/Shell and Total of France — promising them new access to some of the world's largest petroleum reserves.

Chávez's about-face with foreign oil companies comes after he nationalized their oil fields in 2007. Two companies, Exxon Mobil and ConocoPhillips, left Venezuela and are still waging legal battles over lost projects.

As embarrassing as it is, Venezuela has little choice but to form new ventures with foreign oil companies. Nationalizations in other sectors, like agriculture and steel manufacturing, are fueling capital flight, leaving Venezuela reliant on oil for about 93 percent of its export revenue in 2008, up from 69 percent in 1998 when Chávez was first elected.

We can only hope that that these new ventures fall through-- Venezuela needs a less polarizing leader; one that can bring the country together instead of ruling by fear and divisiveness.