Senator Richard Lugar recently warned of the growing threat posed by the Venezuela-Iran alliance. Lugar’s concern is a scenario in which Iran manages to block transit through the Strait of Hormuz, giving Venezuelan president Hugo Chávez the opportunity to deal Washington a “double blow” by simultaneously cutting off oil exports to the United States.
On the surface, this may seem worrying. The two countries have a long tradition of trying to rile oil markets through a combination of bravado—Iran recently announced that it will preempt EU sanctions by halting oil sales to Britain and France—military exercises and repeated vows to cripple the United States any way they can.
Chávez has proven willing to use Venezuelan oil for his political ends, primarily by doling out fuel subsidies to his regional allies but also by delivering oil products to Iran in clear defiance of international sanctions. Yet despite his bluster, Chávez has kept the oil flowing north since he came into office, except for brief period in 2002–2003 when a worker’s strike against Chávez halted oil exports.
Behind the scenes, the anti-American alliance is in tatters. Key to the partnership is Iran’s ability to use Venezuela as a bridgehead for an expanded network of ties throughout Latin America. Shortly after elections brought Chávez allies to power in Bolivia, Ecuador and Nicaragua, Iran’s trade with Latin America soared, tripling from 2007–2008. To help bring those leaders closer into the fold, Venezuela and Iran pledged aid to Bolivia and Nicaragua that, when combined, amounted to more than 20 percent of each country’s GDP. Despite this, Iran’s support network in the region has thinned since 2010.
Mahmoud Ahmadinejad’s four-country tour of Latin America in January, which Lugar and others have cited as a sign of a growing Iranian presence in Latin America, actually demonstrates the decline of Iranian influence. Ahmadinejad didn’t visit Brazil, a country that championed Iran’s right to nuclear energy less than two years ago. He also didn’t go to Bolivia, which is probably the largest recipient of Iranian developmental aid in Latin America. (Iran’s bypass of Bolivia is a sign of ongoing fallout from a visit by Ahmad Vahidi, Iran’s defense minister, to Bolivia last summer. The visit drew Argentina’s ire because the former Quds commander allegedly had a role in the 1994 bombing of a Jewish cultural center in Buenos Aires.)
Unable to keep up the guise of broad-based diplomatic support in Latin America, the central features of the illicit relationship between Venezuela and Iran have become more apparent. As one unclassified Department of Defense report from 2010 points out, members of Iran’s Revolutionary Guard, an elite wing of Iran’s military, “have an increased presence in Latin America, particularly Venezuela.” Given the surge of Hezbollah operatives in the area, the prevailing belief is that the groups may launch retaliatory attacks against the United States or Western-oriented countries in the Americas if Iran’s nuclear installations are bombed.