updated 11/22/2005 3:25:36 PM ET 2005-11-22T20:25:36

Venezuelan officials signed a deal Tuesday to ship 12 million gallons (45 million liters) of discounted home heating oil to poor Americans in Massachusetts as part of plan by Venezuelan leader Hugo Chavez to help needy U.S. communities.

The fuel is being offered by Citgo Petroleum Corp., a subsidiary of Venezuela's state-owned oil company which runs roughly 16,000 gas stations in the U.S.

U.S. Rep. William Delahunt, who helped broker the deal, called the agreement "an expression of humanitarianism at its very best," and rejected criticism that the move was motivated by politics. Chavez often blames the plight of the poor on unbridled capitalism and had criticized U.S. President George W. Bush's government for failing to reduce poverty.

"This is a gesture about people," said Delahunt, a Democrat.

Delahunt said the agreement could set an example for U.S. oil companies. Congressional leaders have asked the companies to use some of their profits to fund heating fuel assistance programs for low-income residents.

"I just hope that this sends a message, and that other oil companies will step and help also," Delahunt said.

Reducing costs?
Chavez announced the idea of offering fuel directly to poor U.S. communities during a visit to Cuba in August. He has said the aim is to bypass middlemen to reduce costs for the American poor.

The plan to provide low-cost heating oil to poor communities in Massachusetts and also the Bronx in New York City is "eminently a political move," said Patrick Esteruelas, an analyst with the New York-based Eurasia Group.

He said it is a way for Venezuela to "compromise the White House position within the U.S." and emphasize what Chavez has long cited as the failings of U.S. policy.

The initiative is part of a larger effort by Chavez to use Venezuela's surging oil wealth to extend the country's influence and create an alternative to what he calls U.S. "imperialism" in the region.

Chavez says he is leading a socialist "revolution" and has become one Bush's strongest critics in Latin America.

Close ally with Castro
The Venezuelan president has sought to strengthen alliances by offering oil deals to countries across Latin America and the Caribbean, shipping fuel on preferential terms while offering low-interest loans and accepting partial payment in goods ranging from bananas to sugar.

Chavez, a close ally of Cuban leader Fidel Castro, has repeatedly accused the U.S. government of plotting to overthrow him -- allegations firmly denied by Washington.

At the same time, Venezuela remains a major supplier of fuel to the United States and provided about 12 percent of U.S. crude imports in September, the last month for which U.S. figures are available.

Chavez has sought to decrease that dependency, seeking new markets in China and elsewhere for Venezuelan oil.

The South American country, which has the largest conventional oil reserves outside the Middle East, is the world's No. 5 oil exporter and a founding member of the Organization of Petroleum Exporting Countries.

Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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