Mexico-Venezuela Clash Over Oil as Foreign Aid

MEXICO CITY –- Venezuelan President Hugo Chavez’s use of “oil diplomacy” to secure his position as the leading socialist voice in Latin America is upsetting relations with Mexico and threatening to unravel a decades-old Mexico-Venezuela foreign aid program to struggling neighbors.

Mexican officials are quietly seething at Chavez’s grandstanding, deploring his use of the San Jose Accord as an ideological weapon in his campaign against the United States.

The San Jose Accord between the two largest oil-producing countries in Latin America has guaranteed crucial shipments of affordable petroleum, regardless of fluctuations in the world market, to Barbados, Belize, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Haiti, Honduras, Jamaica, Nicaragua and Panama.

Inked on Aug. 3, 1980, as oil prices soared and recession buffeted smaller nations in the region, this joint aid program has never been interrupted by any political and economic disagreements with beneficiaries.

Even when Mexico’s diplomatic ties with Cuba reached a low point in May 2004 -- when Mexico led the U.N. condemnation of Cuba for human rights violations, Castro disparaged then-President Vicente Fox as a lapdog of the Bush White House and ambassadors were recalled –- Mexico didn’t disrupt the flow of oil to Havana under the terms of the San Jose Accord.

“The San Jose Accord’s purpose is to provide foreign aid, in apolitical terms, to the nations of Central America and the Caribbean,” says a Mexican official at Pemex, Mexico’s state-owned oil monopoly.

“It has never been used for political purposes, or as a political weapon,” adds the official, sharply alluding to Chavez’s use of oil as a tool to foment socialist “revolutions” in neighboring countries.

Mexican diplomats are stunned by the politicized perception of “oil diplomacy,” and how they now have to defend themselves. “Suddenly there are questions about the ‘wisdom’ of selling oil on preferential terms, or as grants,” a Mexican official at the foreign ministry says.

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