The oil market faces new instability as the Jan. 10 inauguration approaches of newly reelected but apparently ailing President Hugo Chavez of Venezuela.
According to a Dec. 30 announcement by the government, the brashly anti-American populist encountered complications during his fourth cancer operation in Havana.
Chavez—s illness became public knowledge in June 2011 with disclosure of surgery for what was described as a "pelvic abscess." After a second operation, Chavez disclosed his diagnosis of some type of cancer. As the year progressed, his public activities increased, and by January 2012 he was feisty enough to welcome to Venezuela Iranian President Mahmoud Ahmadinejad.
After further surgery the following month and several rounds of treatment, he announced in July that he was free of cancer and would run for reelection.
In an election Oct. 7 in which a record 81% of Venezuelans participated, Chavez, having held office for 14 years, won another 6-year term with 55% of the votes.
At this writing, however, his ability to attend the inauguration, and even his survival, is in question.
A constitution written to Chavez—s specifications offers some guidance for succession in Venezuela, which in 2010 was the world—s eighth largest oil exporter and fourth largest supplier of the US.
Depending on circumstances, Chavez might be succeeded by newly appointed Vice-President Nicolas Maduro, an avowed communist, or Diosdado Cabello, who was expected to be reelected president of the National Assembly on Jan. 5. If the president is inaugurated but must leave office in the first 4 years of his new term, another election must be held.
Complexity makes this succession scheme fragile enough. But the Chavez legacy itself should put the oil market on alert.
Chavez has ruled Venezuela by force and favor—an elected autocrat who has mismanaged the oil industry, undermined the economy, violated human rights, and alienated at least the 44% of Venezuelans who voted for his opponent in October.
Departures of autocrats breed contests for power. Those contests tend not to proceed peacefully.
