Give Thanks to America's 'Nemesis': Cheap Oil for America's Poor

ByABC News
November 22, 2005, 1:23 PM

Nov. 22, 2005 — -- Venezuela has agreed to sell heating oil at discount prices in low-income communities in Chicago, New York and Boston.

Venezuela's president has decided to expand his Oil-for-the-Poor program and sell cheap oil to the No. 1 superpower of the world. The Houston-based petroleum company CITGO, wholly owned by Venezuela, will begin the program in Boston. Up to 12 million gallons of heating oil will be offered at a bargain price, representing $10 million in savings for locals, according to CITGO.

"With this initiative, CITGO is showing its commitment to the U.S. marketplace and to communities where we have a presence," said CITGO president CEO Felix Rodriguez in a prepared statement. "As good corporate citizens, we are making an effort to help those in need."

Despite being the United States' fourth-largest oil supplier, Venezuelan President Hugo Chavez has had a contentious relationship with America.

Elected in 1998, Chavez was removed in a violent uprising in April 2002. He accused the United States of aiding the coup and wanting his death, a charge the U.S. denies.

A month later, Chavez returned to power and subsequently won the referendum recall in 2004.

With oil profits padding the government's coffers (a barrel of oil currently costs $60 versus $15 in 1998), Chavez upped his criticism of the liberal American economic model. He has called Bush a "crazy man" and an "assassin" and has threatened to stop exporting oil to gas-guzzling America saying he's against its imperialist ways.

Chavez thumbed his nose at the Bush administration's poor handling of aid to New Orleans residents, all the while offering to reroute oil tankers to Louisiana since many refineries along the Gulf Coast had been shutdown after back-to-back hurricanes.

More recently, Chavez joined an anti-Bush rally in Argentina during a Latin American summit.

As winter grips the United States, Chavez has pursued his pledge to help America's poor. He had suggested using the windfall from record oil prices during the United Nations plenary session in late September. Venezuela already doles out cheap oil to a dozen Caribbean countries, including Cuba.

Turns out he's going ahead with his plans. No specifics have been given but CITGO has brokered deals with state representatives and local nonprofit organizations to target the neediest families and schools.

"My constituents are facing some of the highest energy bills in recent history, even as oil companies are reporting the largest profits in recent memory," said Rep. Jose Serrano, D-N.Y., in a prepared statement. Serrano said CITGO would provide 8 million gallons of home heating oil below cost the week after Thanksgiving to nonprofit housing providers in the Bronx.

Meanwhile, U.S. oil companies haven't responded to lawmakers' request to share the wealth and donate some of their profits to the poor to cover higher heating bills.