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Chávez, China cooperate on oil, but for different reasons

The Venezuelan president touts Beijing's $4 billion investment as another punch in his bid to undermine US clout. China is more pragmatic.

New bonds: Venezuelan President Hugo Chávez (l.) is seeking to diversify his country's oil exports to countries like Hu Jintao's (r.) China.

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One country's motivation is political, the other's pragmatic. Venezuela is seeking a strategic geopolitical alliance, China a steady supply of energy.

A new oil exploration deal between the two countries – China's largest single investment in an overseas energy project to date – makes US officials nervous. But with Chinese and Venezuelan goals in such stark contrast, say most observers, Washington has little cause to fear a new anti-American axis stretching from the Pacific to the Caribbean.

Venezuelan President Hugo Chávez has cast the $6 billion deal as another punch in his campaign against US political and economic hegemony in world affairs.

Beijing takes a more practical view of the deal. "Wherever there is oil there are Chinese," says Jiang Shixue, deputy director of the Institute for Latin American Studies at the China Academy of Social Sciences, a government-run think tank in Beijing. "China wants more oil and it is going all over the world" to find it.

More oil to China = less for US?

Under the November agreement, China will pay $4 billion into a $6 billion fund to develop Venezuela's oil industry, in return for the rights to explore for oil in Venezuela's Orinoco region, potentially among the world's richest deposits.

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