MIAMI, July 30 (UPI) -- Venezuela has agreed to sell oil to Spain at the deeply discounted price of $100 a barrel in exchange for medical materials and new technology, the latest in a series of preferential energy agreements orchestrated by Caracas.
During his recent European tour, Venezuelan President Hugo Chavez called the $100 sale price offered to Spain "fair," noting that "Venezuela has never wanted oil to cost more than" that and that the $100 mark ultimately would be a favorable price per barrel on the international market.
"If the price settles around $100, that would seem fair and right," said Chavez.
The reduced price for Venezuelan oil to Spain does come with a caveat: Spanish officials said their country would provide Venezuela with medicine, building materials and other technologies as part of the agreement between the two nations.
Chavez's seeming desire to reach out to Spain with its oil reserves, despite last year's verbal volley between himself and Spain's King Juan Carlos, who told the ever-outspoken leftist leader to "just shut up," is not unprecedented.
However, it appears the Venezuelan leader is trying to extend his particular brand of petroleum-based influence beyond the boundaries of the Western Hemisphere, where he has offered discounted oil to Caribbean and Central American countries, as well as several U.S. cities, whose poor recipients of discounted heating oil praise the Venezuelan president often maligned by Washington.
Awash with petrodollars, Venezuela has sought to expand its influence in the Caribbean through its discount oil initiative known as Petrocaribe.
Launched in 2005, the agreement allows Caribbean member nations to purchase Venezuelan oil at a deeply discounted price -- a deal that has alleviated many Caribbean nations' energy woes and lessened their dependence on U.S. financial aid.
"Petrocaribe is one of Chavez's most important geopolitical tools in Latin America," read a report released Monday by the Washington-based Latin Source think tank.
Among Petrocaribe's biggest beneficiaries have been nations like Cuba, the Dominican Republic, Jamaica and Nicaragua.
And in January, Chavez announced his country's decision to build a refinery on the Caribbean island of Dominica, part of his effort to further integrate the region's energy supplies. The Venezuelan president said Dominica's refinery would be a jumping-off point for distributing Venezuelan oil to other eastern Caribbean countries.
In late 2007 Venezuela announced it would help Cuba get a Soviet-era oil refinery back online after decades of dormancy.
The plant went back online with the help of Venezuela and some $136 million in repairs funded by Caracas; it is believed to be capable of processing some 65,000 barrels per day. Venezuela, meanwhile, sends about 100,000 bpd to Cuba at a discounted price, part of the Petrocaribe agreement.
Cuban officials have lauded the return of operations at Camilo Cienfuegos, though some say the plant may still need work before becoming fully operational.
But Chavez appears willing to spend the billions of dollars in state oil and gas revenue to exert his influence both closer to home and now across the Atlantic.
Part of that effort is an ambitious gas pipeline proposal by Chavez that would stretch from northern Venezuela to the tip of South America, fueling Brazil, Uruguay and Argentina with Venezuelan gas.
Critics of the multibillion-dollar proposal say a pipeline extending through thousands of miles of jungle thicket and desolate mountains would make the project prohibitively expensive, even for oil and gas revenue-rich Venezuela.
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