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Hugo Chavez blames U.S. for high oil prices

/ Source: The Associated Press

Venezuelan President Hugo Chavez blamed the United States for the high cost of oil Thursday, saying the American hard line on Iran was driving prices to record levels.

Chavez predicted that the cost of oil would soar far higher if the standoff over Iran's nuclear program led to a U.S. attack on the Islamic republic.

Oil prices fell slightly Thursday after reaching a record high above $72 a barrel.

"It could reach $100 ... It is up to the United States," Chavez told reporters as he arrived in southern Brazil on a trade mission. He attributed the already-high price to American "bellicose statements and the American president's threats against Iran."

"They must abandon the option for war against Iran," Chavez said. "Iran has the right to develop nuclear energy for peaceful purposes."

The U.N. nuclear watchdog agency is preparing to release a report next week on Iran's nuclear program, which the Iran says is for peaceful energy generation. The U.S. and its allies believe Iran is seeking nuclear weapons.

President Bush has dismissed media reports that the U.S. has made plans to attack Iran if its nuclear program is not halted.

Chavez, a constant critic of U.S. policy, warned Wednesday that his government would blow up its own oil fields if the United States ever were to attack Venezuela, the world's fifth-largest oil exporter.

Chavez said his country would continue exporting petroleum to U.S. ports, "unless they attack us, in which case there will be no oil."

The U.S. ambassador to Venezuela, William Brownfield, told reporters in Caracas on Thursday that he hoped oil exports to the U.S. would continue, saying the two countries were "natural partners for geographic reasons."

Chavez is looking to diversify Venezuela's all-important petroleum markets away from the United States as he seeks to increase oil exports to Latin America, the Caribbean and energy-hungry China.

Brazil, Venezuela and Argentina have been studying a proposed transcontinental pipeline linking their countries to Venezuelan natural gas fields.