Never again will they rob us the ExxonMobil bandits. They are imperial, American bandits, white-collared thieves. They turn governments corrupt, they oust governments. They supported the invasion of Iraq."Never again will they rob us — the ExxonMobil bandits. They are imperial, American bandits, white-collared thieves. They turn governments corrupt, they oust governments. They supported the invasion of Iraq."
This was the response from Venezuelan President Hugo Chavez to the successful lawsuit by the world's biggest corporation (ExxonMobil), freezing US$12 billion in assets of Venezuela's state-owned oil company, PDVSA — a serious escalation in Big Oil's long running dispute with Chavez and the movement he represents.
ExxonMobil isn't suing PDVSA because it needs the money. The world's largest publicly traded corporation recorded profits of $40.6 billion in 2007, up 3% from 2006's record. A February 2 Globe and Mail article reports that "its 2007 profit [exceeds] output of two-thirds of the world's nations".
ExxonMobil claims it is suing PDVSA because of a June 2007 deadline given by Chavez to Big Oil corporations operating in Venezuela, demanding they cede majority control in their heavy-crude upgrading projects.
ExxonMobil and ConocoPhillips filed arbitration requests with the International Center for Settlement of Investment Disputes, and ExxonMobil simultaneously took legal action in US and British courts, which on February 7 agreed with its claim, and ordered the asset freeze.
But there is much more at stake than a simple legal disagreement. First, many other Big Oil companies have agreed to Chavez's terms, including Chevron Corp., Statoil ASA, BP PLC and Total SA.
Second, Venezuela is not the only country to confront Big Oil and demand that old contracts be renegotiated. In Canada, Newfoundland's Danny Williams demanded and won an ownership share in the multi-billion-dollar Hebron offshore oil deal.
Even the Tories in Alberta are forcing Big Oil to pay higher royalties.
And in Russia, "both BP PLC and Royal Dutch Shell PLC have ceded control in big, lucrative Siberian projects to Russian gas monopoly OAO Gazprom", according to a June 27 Globe and Mail article by Russel Gold last year.
ExxonMobil's ultimatum has more to do with politics than economics. Russia's ruler Vladimir Putin holds office because of his ties to the secret service, crackdown on public debate, and commitment to the world of Big Power politics. That world of corruption and repression is comforting and familiar to the owners of ExxonMobil.
Chavez, by contrast, holds office because millions have repeatedly been willing to put their bodies on the line against multinational corporations and their local allies. That revolutionary movement is terrifying to ExxonMobil.
So — working with courts in the two biggest Western imperialist powers — ExxonMobil is testing the water, seeing just how strong the revolutionary movement in Venezuela is. This is especially critical given the setback faced by Chavez in the December constitutional referendum.
And we shouldn't doubt the capacity of multinational corporations to use a legal fig leaf to pursue their "right" to pull exorbitant profits out of the Global South. "BP won an arbitration case against Libya in the 1970s", Gold reported, "and chased tankers of Libyan crude around the world to seize them as payment".
In 2006 and 2007, "Western companies that purchased debt for unpaid construction work in the Congo have tried to seize tankers of Congolese oil to satisfy arbitration awards".
The ExxonMobil attacks have been met with defiance in Venezuela, with Venezuelan energy minister Rafael Ramirez insisting that "PDVSA is operating at 100%", according to a February 9 Chinaview.cn article.
Chavez has said that if ExxonMobil does succeed in freezing PDVSA assets, he would halt oil exports to the United States — a threat the US has to take seriously.
As well as being the fourth largest exporter of oil to the US, if Venezuela succeeds in certifying an additional 200 billion barrels of oil reserves to the 100 billion already certified, it will officially have the most proved reserves of oil in the world.
With so much at stake, US imperialism and its corporate allies are not in a position to launch a sequel to the failed coup of 2002. Venezuela's revolutionary movement is too big, and Venezuela's oil is too important for that to happen — for now. But we know from history that this is not the last confrontation between corporate and popular power in Venezuela.