Chavez seeks to counter U.S. influence at South American energy summit

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By Fabiola Sanchez -- Associated Press

PORLAMAR, Venezuela (AP) - Venezuelan President Hugo Chavez warned that the world faces a looming energy crisis and offered on April 17 to share Venezuela's oil and natural gas wealth with all of South America in an effort to roll back U.S. influence.

Hosting an energy summit, Chavez told South American leaders that he does not object to ethanol - which the United States and Brazil have agreed to jointly promote - but that he does oppose U.S. plans to step up production of ethanol made from corn. He called it ''taking corn away from people and the food chain to feed automobiles - a terrible thing.''

He also urged the United States to lower tariffs on Brazilian ethanol made from sugar cane, adding to pressure on Washington by Brazilian President Luiz Inacio Lula da Silva.

''We aren't against biofuels,'' Chavez said. ''In fact, we want to import ethanol from Brazil.''

Chavez has warned that the March U.S./Brazil agreement on ethanol would monopolize arable lands and starve the poor - concerns shared by his Cuban ally, Fidel Castro.

The United States and Brazil are the world's two biggest producers of ethanol - the alcohol-based fuel made from crops such as sugar cane or corn. They signed an ''alliance'' in March to promote its production in the region and create international quality standards to allow it to be traded as a commodity like oil.

Brazil has defended its ethanol agreement at the summit. Marco Aurelio Garcia, an adviser to Silva, denied that Brazil's plan would cause food prices to skyrocket and defended it as a way of creating jobs.

''Nobody stops eating due to shortage of food. People stop eating due to lack of income. That's the fundamental issue,'' Garcia said April 16.

Chavez said biofuels are a ''valid strategy, above all making sure that it doesn't affect food.''

Chavez, whose country is a major oil supplier to the United States, blamed the war in Iraq on a U.S. thirst for oil and called it a symptom of larger problems to come.

''A true energy crisis is being cooked up on low heat, a crisis that could reach great dimensions,'' Chavez told presidents and other officials in a speech.

He said Venezuela will give priority to sharing its oil and natural gas wealth with Latin America, saying it can become ''the great axis'' of regional integration.

Officials from a dozen South American countries were attending the two-day summit on Margarita Island, where Chavez was seeking support for projects including a regional ''Bank of the South,'' a natural gas pipeline and a proposed gas alliance modeled after the Organization of Petroleum Exporting Countries.

On ethanol, Brazil's energy minister, Silas Rondeau, managed to block draft summit declaration wording by Venezuela and Bolivia stating that biofuel production should not harm agricultural harvests or protected forested areas, Brazil's Agencia Estado news agency reported.

Chavez used to speak warmly about ethanol's future, but he came out harshly against its promotion as a substitute for gasoline after the U.S./Brazil agreement.

His concerns are shared by some experts who say that even if all arable land on Earth were turned over to biofuel production, it still would not meet world demand for fuel. Venezuela still plans to expand its own ethanol production for use as a fuel additive.