Venezuela to supply St Lucia with Oil

CARACAS, Venezuela (AP) – Venezuela will supply the Caribbean nation of St Lucia with 1,700 barrels a day of oil products, the state oil company said Tuesday.

Petroleos de Venezuela SA, or PDVSA, said in a statement that it will shortly sign the supply deal for products derived from crude as part of its Petrocaribe programme under which Venezuela sells oil to Caribbean nations with preferential financing.{{more}}

PDVSA said it has also signed an agreement with Hess Oil Saint Lucia to use its 9 million barrels of storage capacity on the island, which will help in distributing oil in the region.

Venezuela’s Petrocaribe agreement has pledged to sell fuel to 14 Caribbean nations under preferential financial terms. But it has had trouble meeting some of those obligations as it lacks a storage and distribution network in the region.

President Hugo Chavez launched the Petrocaribe effort in June 2005 calling it a step toward regional solidarity. The programme provides for Venezuela to sell oil at market prices but requires only partial payment up front. The rest can be financed at low-interest and partially paid for in services or goods, such as rice and bananas.

Venezuela is the world’s fifth largest oil exporter. Saint Lucia, a former British and French territory, produces no oil.