United States and Venezuela Discuss Oil Export Agreement

Discussions are underway between Venezuela and the United States to guarantee oil exports to the United States over the next 20 years. Some of the largest oil reserves in the Western Hemisphere are in Venezuela and the South American country is among the top four oil suppliers to the United States.

U.S. Undersecretary of State for Economic Affairs Alan Larson discussed the deal with President Hugo Chavez and oil officials Thursday. While no details were released, Larson said U.S. companies were eager to invest in Venezuela to "increase oil production to make it more profitable" and promote Venezuelan development and democracy. U.S. firms also are interested in Venezuela's Deltana natural gas platform, off the northeast coast near Trinidad and Tobago, Larson said. Venezuela estimates the area has gas reserves of 40 trillion cubic feet, and developing it could bring in $4 billion in investment dollars.

Cabinet officials told Larson that Venezuela is committed to signing a bilateral foreign investment treaty that would protect investor rights and crack down on contraband. Venezuela imports almost 60 percent of its food, and the United States is its biggest provider of farm products.

Larson also promoted U.S.-led efforts to create a hemispheric free trade zone by 2005. Chavez argues the zone would force poor countries like Venezuela to compete with rich nations under unfair conditions, and he vows to put any proposed treaty to a national vote. "The conversation we had (with Chavez) about expanding trade was very useful," Larson said. "We must use the expansion of trade as an instrument to reduce poverty."