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September 9, 2009
Iran won’t benefit much from Venezuelan gasoline

Venezuela has agreed to export 20,000 barrels of gasoline per day to Iran.

Here’s something from the Associated Press that needs some refining:

TEHRAN, Iran — Venezuelan President Hugo Chavez sealed an agreement to export 20,000 barrels per day of gasoline to Iran, state TV reported Monday. The deal would give Tehran a cushion if the West carries out threats of fuel sanctions over Iran’s nuclear program.

The two countries signed the agreement late Sunday during a visit by Chavez, who pledged to deepen ties with Iran and stand together against what he called the imperialist powers of the world.

Before we start fretting about Hugo Chavez giving aid and support to an enemy (it’s not helpful to talk about Venezuela or Iran that way), let’s take a look at the reality. Iran’s oil production of about 4 million barrels daily is twice as large as Venezuela’s. Its refineries have a capacity to produce more than 1.5 million barrels of gasoline daily — Chavez’s generous offer to Iran amounts to about 1.5 percent of Iran’s ability to produce refined products. Iran has been a gasoline importer, but is taking steps to halt imports within four years.

In short, Iran won’t benefit much with gasoline from Venezuela, its fellow OPEC member. If the United States and Europe were to follow through with sanctions, Iran probably would still be importing all of the goods it needs and its refineries would still be running. (Not to get too technical: a barrel of oil is about 42 gallons, and that yields roughly 19 gallons of gasoline)

Chavez is actually making a small deal with Iran to thumb his nose at the United States, an exercise he and Iran’s President Mahmoud Ahmadinejad practice whenever they can. Europe is part of the game in this case, because Chavez is supporting Ahmadinejad’s defiance of a deadline declared by U.S. and European officials, threatening sanctions by the end of September if no progress is made on reining in Iran’s nuclear program.

Whatever you want to call Chavez, whose country sells roughly 1 million barrels of crude to the United States daily, you’re not going to change his mind, or change the policies of the Iranian government by employing threats and boycotts. Ahmadinejad and Chavez share something -– they are both reactionaries in the true sense of the word: They do and say things to be provocative.

The Obama administration, in both cases, appears to understand that better than its predecessor, which railed and saber-rattled to no end. Meanwhile, boycotts and embargoes, state-sponsored, rarely if ever work. The United States imposed a boycott on Cuba 50 years ago, and that policy is widely considered a failure. The United States slapped a grain embargo on the Soviet Union in the 1980s after the Communist government invaded Afghanistan — international grain merchants kept the grain running through subsidiaries in places like Brazil and Argentina.

Sanctions usually paper over the lack of a policy. The problem with Iran and Venezuela is that the United States would do well to find ways to negotiate. Unlike George W. Bush, President Obama has said that you don’t only talk to friends; sometimes you have to negotiate with people you don’t necessarily like.

It is one of many challenges that will define U.S. foreign policy these years, and provocative acts and speeches have to be understood and kept in context.

– Peter Eisner

Photo courtesy of Flickr user Magnera under a Creative Commons license.

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the power base is american multinational corporations ,the republic of america is a house built on sand as regards democracy and the peoples will, in the founding days the constitution was adiquit,but since has become a relic to beguile the public,ask any jew ?


Threatening to cut off Iran’s gas imports only give validity to Iran’s arguments when they say they need the ability to produce their own fuel because the West will not honor any obligations to supply Iran with fuel.


This is the same kind of disapproving attitude the U.S. has towards Iran becoming a nuclear state.

Asia Chronicle News provides some in-depth analysis on U.S.-Iran relations. Worth a read I think.

Peter Eisner is an editorial consultant with Worldfocus and a 30-year veteran of international news. He has been an editor and foreign correspondent at The Washington Post, Newsday and The Associated Press. He co-authored “The Italian Letter,” which details fraudulent intelligence leading up to the Iraq War. He was founder and president of Newscom, an international online news service, and speaks Spanish and Portuguese.

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