Plan Colombia and Beyond

So the Bush administration doesn’t have major reasons to complain about the building of a gas pipeline between Maracaibo and La Guajira. The greatest concern would probably have to do with the administration’s general aversion to any initiative that smells of Hugo Chávez. The dominant role of PDVSA (the Venezuelan state energy company) might make them uncomfortable.

The Bush administration might also be disappointed by this evidence that Álvaro Uribe does not wish to participate in the U.S. effort to isolate Chávez. Instead, the Colombian president has prioritized his commercial interests over serving as “our man in the Andes,” as George Bush asked of him during his last visit to Washington.

Gas deals don’t bother Washington much. But if the gas pipeline were an oil pipeline, the U.S. reaction would be quite different, and much stronger.

The United States imports 4 million barrels of Latin American oil each day, mainly from Venezuela, Ecuador and Mexico. This represents almost 30 percent of all U.S. oil imports, and more than 20 percent of all oil that the United States uses.

Washington is worried about the stability of petroleum flows from Latin America. At the end of June, the Financial Times of London ran a story about a recent internal report of the U.S. Southern Command expressing concern for the growth of “resource nationalism” in the region. The tendency toward nationalization, the military report claims, could “increase inefficiencies” and complicate petroleum supplies. In March, meanwhile, a House of Representatives committee hearing aired concerns about disturbances to the hemispheric oil market due to recent political tendencies.

Ecuador’s recent confiscation of Occidental Petroleum’s installations so angered the Bush administration that its representatives abandoned free-trade negotiations. The declared interest of Ecopetrol (the Colombian state oil company) in investing in these Ecuadorian oil fields earned Álvaro Uribe a rare scolding from Condoleezza Rice during his June visit to Washington.

Every time Hugo Chávez speculates about the possibility of boycotting oil sales to the United States, the U.S. government notices and becomes concerned. But cutting off sales to Venezuela’s largest customer is not a realistic option for Chávez.

Venezuela, without a port on the Pacific, cannot easily reach alternative markets in Asia, especially China’s increasing demand. Where oil is concerned, Hugo Chávez and George Bush need each other, at least for now.

This situation of co-dependency could rupture, however, if Colombia and Venezuela make progress toward another joint project that has been under discussion: the building of an oil pipeline from Venezuela and across Colombia, ending at a port on Colombia’s Pacific.

This pipeline would give Venezuela much greater access to Asian demand, and Venezuela would depend much less on the U.S. market. With Venezuela’s worldwide oil sales diversified by a trans-Colombian oil pipeline, Hugo Chávez would be much more able to consider the possibility of selling less oil to the United States – or of boycotting the “gringos” completely.

If the plans to build this oil pipeline grow closer to reality, then, we can expect some strong pressure from Washington to stop the project.