Venezuelan President Hugo Chavez used last week’s oil summit to demand justice from industrialised nations Charlotte Denny and Alex Bellos in Caracas Opec blamed the tax systems of rich countries for high oil prices last week as they rallied to the call by the Venezuelan President, Hugo Chavez, to politicise the oil producers’ cartel as a campaigning advocate for the developing world. During the closing session of the group’s first summit in 25 years, Opec launched a “Caracas declaration” that put aside long- standing animosities in the name of unity, and pledged to supply petrol at “fair and stable” prices. The summit was a personal triumph for the charismatic Chavez, the man analysts say is most responsible for resurrecting Opec from a moribund and fractured organisation two years ago when the price of oil crashed. With barely concealed glee that the high price of oil has given Opec new relevance, he hosted the summit with the grandeur of a man staking his claim to be self-appointed leader of the developing world. The Caracas declaration echoed his anti- imperialist viewpoint by urging developed countries to recognise that the biggest environmental tragedy facing the globe is poverty.
However, Saudi Arabia undermined the unified front that Opec presented to the West when it promised to pump as much crude as necessary to lower world oil prices. The assurance from the world’s largest oil producer that it would act came after Venezuela said that further attempts by Western leaders to ease prices by dipping into strategic reserves would be met by cuts in Opec production quotas.
“The kingdom is willing and ready to offer the amount necessary to stabilise the world oil market,” said Crown Prince Abdullah. “We are worried by the increase in oil prices, which, if continued permanently, could lead to a negative impact on the world economy and theEprospects for world economic growth.” But he repeated Opec’s call for oil-importing countries to play their part in easing prices by reducing taxes on fuel. “We call upon consuming countries to share the sacrifice through the taxes that they impose on oil . We are unfairly blamed for all the problems of the world economy.” Chavez, in a key speech at the summit, rallied leaders of the other 10 Opec countries to demand justice from industrialised countries. It was excessive fuel taxation that was endangering world economic growth, he said. “Opec is not blackmailing anyone. Opec is not a cause of poverty in the world . The debt burden is a greater hindrance to development than the high oil price.” Chavez has been Opec’s loudest voice since he took office in February last year, when oil was $13 a barrel and the cartel was mired in bickering over quotas. In the same way that the forceful Chavez has taken control of Venezuelan institutions, so industry analysts credit him with bringing discipline to the traditionally fractious cartel. This year he toured all Opec countries to invite them to the summit. He took delight in irritating the West by being the first president to visit Saddam Hussein since the Gulf War. The summit has coincided with protests in Europe against pump prices, adding to Opec’s reinvigorated sense of importance. “The eyes of the world are upon us,” Chavez said. “Everyone is attentive to what we do, what we discuss, what we decide.” The summit is only the second in Opec’s 40- year history because the organisation has been complicated by wars between members – Iran and Iraq in the 1980s, and Iraq’s invasion of Kuwait in 1990. Whereas Saudi Arabia, the most influential and least hawkish Opec country, preached moderation, other countries rallied to Chavez’s anti-imperialist cry. “In many countries the tax on oil has become an important means for financing their various projects instead of looking for other sources of income,” said Qatar’s Foreign Minister, Sheikh Hamad Bin Jassem Bin Jabor al-Thani. Iran’s President Mohammad Khatami denounced what he called the new “world attitude”, adding thatEOpec countries were “waiting forEinternational financial institutions toEgive all countries an equal opportunity”.