Chavez said on his radio talk show late Thursday that he had spoken to Argentine President Nestor Kirchner about the idea of forming "a kind of Organization of Gas Exporting and Producing Countries in South America." He proposed naming it Opegas Sur, and said it would start with Venezuela, Bolivia and Argentina, but could be expanded.
Far-fetched and toothless is how some natural gas experts described the idea Friday. One reason is that none of the three countries exports natural gas outside of South America, which stymies their ability to influence world gas markets. Venezuela doesn't export any gas at all.
"I'm not really sure what would be the objective," said Anouk Honore, a natural gas analyst at the London-based Oxford Institute for Energy Studies. It might make more sense if the proposed cartel were to include Trinidad, a major gas exporter, she suggested.
"It would have zero impact," declared Bolivian petroleum analyst Andres Stepkowski.
He noted that the Organization of the Petroleum Exporting Countries influences oil prices because crude is sold on a spot market — that is, sold for cash and delivered immediately — so any output cuts are felt immediately.
Natural gas, however, is sold through long-term contracts, and suppliers and buyers use a formula to adjust the price every three or six months.
A natural gas cartel might work against Chavez's integrationist goals because it would mostly hurt South American consumers.
