With the world's largest proven reserves, it isn't surprising that oil is fundamental to Venezuela's economy, politics and society at large.
Currently, Venezuela is providing subsidised oil to allies in Latin America and beyond. The Bolivarian Republic is also forging new commercial agreements with China, Iran, Russia and other countries, in a departure from previous policies that focussed on the US market.
With high prices and increasingly global demand from emerging markets, oil - for better or worse - will continue shaping the 21st century. And Fernando Travieso Lugo has a front row seat.
An analyst with the Socialist Petroleum Observatory and a key adviser to Venezuela's government on oil matters, Lugo was one of the men shaping energy policy during the tenure of president Hugo Chavez.
Fernando Travieso Lugo spoke with Al Jazeera's Chris Arsenault at his office in one of the newly created "Bolivarian Universities" in Caracas in October 2012.
Chris Arsenault: What was the biggest change in the oil sector after Hugo Chavez was first elected in 1998?
Fernando Lugo: There are three remarkable facts: The nationalisation of oil companies in the Orinoco, the new petroleum law and our rescuing of OPEC (the Organisation of Petroleum Exporting Countries) in 1999-2000.
In 1999, Venezuela started to comply with OPEC production targets. Then, the (cartel of exporters) held their summit in Caracas in 2000.
Seven months before Chavez came to power, Venezuela's production quota (from OPEC) was 2.8 million barrels per day, but we were producing 3.3 million. Other countries emulated this (policy of producing above quota) and the price was $7.20 a barrel.
In 2000, royalties paid to the Venezuelan state went from one per cent to more than 30 per cent. That implies the state has received $350bn which otherwise would have been given away had the new oil law not been passed in 2000.
The opposition (governments who ruled prior to 1998) were giving away our resources and subsidising the world's strongest economies. The opposition did not represent Venezuelan interests and they did not know about oil. They were against OPEC and would not respect OPEC quotas.
CA: Do you think it's sensible to have PDVSA, the state oil company, distributing food and recruiting doctors as part of Venezuela's new style of socialism? Don't you think the oil company should focus on extracting crude?
FL: PDVSA is less bureaucratic for distributing food and health [than other government departments]. It is efficient and the people are highly trained.
CA: Venezuela is paying interest on Chinese loans with oil straight out of the ground. Every day, more than 260,000 barrels are going to the Asian giant just to pay interest on debt. Isn't this an example of "imperialism"?
FL: China paid beforehand; this [oil] is like a down payment.
CA: Oil accounts for about 95 per cent of Venezuela's export earnings and 40 per cent of government revenues, according to data from Michigan State University. This dependency increased during the Chavez era. Are you worried?
FL: [As for dependency], each year the world has less oil and we have an increasing price. The role of oil in the economy thus becomes bigger. This is the reason [why oil represents such a large share of government revenue].
We are doing what the US did before WWII. We are using oil reserves to create industrial capacity. The government has spent a lot of money to enhance the health and education of the population.
We want to use the oil to get rid of oil… we are beginning to evolve towards renewable technologies.
CA: Venezuela has nationalised the holdings of US oil giants including Exxon and ConocoPhillips. Are you worried about scaring-off investment or further damaging relations with the US?
FL: The only ones who ever stopped the flow of oil to the US was the opposition during the oil sabotage in 2002. They closed the tap not only to the governments of the world, but to the people of the world.
Daily consumption in the US is about 20 million barrels. Venezuela exports them about 1.3 million. Should they need more oil, PDVSA should be able to provide it.
PDVSA has US, UK, Russian, Chinese and Indian technology. Twenty-four countries and 30 companies are represented in Venezuela, and we want to increase that number. After our election, and the US election, we will improve the relations, I think.
We have excellent relations with Chevron-Texaco. In the future, in my opinion, ConocoPhillips will be back if they end their lawsuit against us.
The US needs oil and we will be able to provide it for the next 100 years. We will also provide oil to other countries: China, India and across Latin America.
Source: Al Jazeera