Green Room

Obama’s $2 billion to Brazil ends up helping send oil to China

posted at 9:27 am on January 26, 2012 by

Remember this?

The U.S. is going to lend billions of dollars to Brazil’s state-owned oil company, Petrobras, to finance exploration of the huge offshore discovery in Brazil’s Tupi oil field in the Santos Basin near Rio de Janeiro. Brazil’s planning minister confirmed that White House National Security Adviser James Jones met this month with Brazilian officials to talk about the loan.

The U.S. Export-Import Bank tells us it has issued a “preliminary commitment” letter to Petrobras in the amount of $2 billion and has discussed with Brazil the possibility of increasing that amount. Ex-I’m Bank says it has not decided whether the money will come in the form of a direct loan or loan guarantees. Either way, this corporate foreign aid may strike some readers as odd, given that the U.S. Treasury seems desperate for cash and Petrobras is one of the largest corporations in the Americas.

And this?

“We want to work with you. We want to help with technology and support to develop these oil reserves safely, and, when you’re ready to start selling, we want to be one of your best customers.”

Mr. Obama was saying that while he was drastically slowing down leasing and permitting in the US and whining about “subsides” to US oil corporations. We apparently can subsidize government controlled oil companies in foreign countries, but not here (and I’m not arguing for subsidies here – just pointing out the usual Obama contradiction – kind of like he’s against bailouts, except for Chrysler, GM, Solyndra, etc.)

Well, that little jump-start of ObamaDollars has indeed helped “develop these oil reserves”. And the beneficiary?

Off the coast of Rio de Janeiro — below a mile of water and two miles of shifting rock, sand and salt — is an ultradeep sea of oil that could turn Brazil into the world’s fourth-largest oil producer, behind Russia, Saudi Arabia and the United States.

The country’s state-controlled oil company, Petrobras, expects to pump 4.9 million barrels a day from the country’s oil fields by 2020, with 40 percent of that coming from the seabed. One and a half million barrels will be bound for export markets.

The United States wants it, but China is getting it.

Less than a month after President Obama visited Brazil in March to make a pitch for oil, Brazilian President Dilma Rousseff was off to Beijing to sign oil contracts with two huge state-owned Chinese companies.

Well done, Mr. Obama.

[HT: Red Country]

~McQ

Twitter: @McQandO

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Comments

Obama gets duped by the Chinese. Again.

What’s next? Will he light up a big Cuban cigar and help Castro extract the oil off Cuba’s coast (or is it Florida?)so they can sell it to China?

Marcus Traianus on January 26, 2012 at 9:42 AM

Boggles the mind

Arghhhhh

cmsinaz on January 26, 2012 at 9:43 AM

Henry Waxman should be outraged! The Koch brothers have Soros has big money in Petrobras.

mchristian on January 26, 2012 at 9:58 AM

Boil it down. China like any other country has a finite oil demand,no matter how much it grows from year to year, but for a given year it is finite.

If China gets x amount from Brazil then that puts less demand need for Canadian oil from a west link pipeline as a second option over the Keystone XL pipeline.

China can’t buy more than they need and drink it in milk shakes or something and tanks to store oil for next year are only so big.

China has a lot of bubbles in their economy which they can’t sustain and when the first one breaks ,some argue it already is, the rest will follow in quick sequence.

CommentGuy on January 26, 2012 at 10:12 AM

What else is new.

jeanie on January 26, 2012 at 10:29 AM

Just more Smart Power being applied stupidly.

climbnjump on January 26, 2012 at 10:38 AM

So we are borrowing billions from China to give to Brazil in hopes of getting some oil from Brazil and instead it’s going to China.

Obama should get a nobel prize.

HumpBot Salvation on January 26, 2012 at 10:47 AM

No surprise here. Obummer doesn’t want US to use oil at all, so of course he’s going to let the Chinese have it all.

dentarthurdent on January 26, 2012 at 11:32 AM

So we are borrowing billions from China to give to Brazil in hopes of getting some oil from Brazil and instead it’s going to China.

Obama should get a nobel prize.

HumpBot Salvation on January 26, 2012 at 10:47 AM

Sorry, but I have to correct you – we are borrowing billions from China to give to Brazil so they can sell their oil to China. Obama never had any intention of bringing any of that Brazilian oil to the US because we are not to be using oil any more – we’re all GREEN now.

dentarthurdent on January 26, 2012 at 11:35 AM

So many great campaign ads! This one will really sing when we’re paying 5 bucks a gallon this summer.
Now to get a candidate with enough cajones to run with it.

Capt Blasto on January 26, 2012 at 12:58 PM

This post has been promoted to HotAir.com.

Comments have been closed on this post but the discussion continues here.

Ed Morrissey on January 27, 2012 at 1:14 PM

Follow the money. How much of the two billion was returned to Odumba’s pockets? If the people that are living on “entitlements” only knew that their free ride is over when Odumba finally succeeds in bankrupting the country maybe then they would vote for anyone but Odumba. .
I usually determine whom to vote for by finding out whom the ” entitlement” group wants to vote for in the next election. The socialist person they want elected is the one that I vote against. It is hard to believe that our beloved beloved country is surely and rapidly becoming a socialist nation. How in the world can we let 50% of the people refuse to work and give them a free living? This will lead to the downfall of our country and a bitter civil war.

harvey1 on January 27, 2012 at 12:05 PM