Chavez threat won't matter, analysts say

If Chavez actually cuts off supplies the U.S., the impact would be mostly symbolic, said oil analyst Peter Beutel of Cameron Hanover in New Canaan, Conn. Any short-term supply disruption would dissipate as other nations make arrangements to take the Venezuelan crude and the U.S. makes up its shortfall by purchasing additional barrels from the Middle East, Africa and other regions. 'It makes no sense for Mr. Chavez to follow through on his threats' because the U.S. refining industry's plants -- some of which are owned by Venezuela -- are customized to handle much of Venezuela's high-sulfur crude oil, said Tom Kloza, chief oil analyst at the Oil Price Information Service in Wall, N.J. If Venezuela's crude was low in sulfur content -- making it more valuable on the global market -- he might have a better hand to play, Kloza said. Indeed, the U.S. remains the No. 1 buyer of Venezuelan oil, purchasing more than 41 million barrels in November, accounting for roughly 10 percent of all crude-oil imports that month, according to the most recent Energy Department data available. With oil prices hovering above $90 a barrel, Chavez relies largely on U.S. oil money to stimulate his economy and bankroll social programs that have traditionally boosted his popularity. Nevertheless, Chavez in December lost a vote on constitutional changes that would have let him run for re-election indefinitely.