Prensa Latina reports that Venezuelan President Hugo Chavez has announced that the country will create 1,000 new free food centers, using money from petroleum sales.

Funding for the program ... which will cost US$290 million ... will partially come from the $445 million oil sales to CITGO, a US affiliate of Petroleos de Venezuela (PDVSA) in the United States.

Chavez explained that PDVSA has restructured its US subsidiary to reduce the amount it pays to the US ... its stateside refineries had been less than profitable for Venezuela and were essentially a subsidy for the US economy.

The President of Venezuela explained that the rewriting of PDVSA's operating contracts from eight refineries and 14,000 gas stations in the US will include greater control and more income for Venezuela. Those profits will now go the Venezuelan Agrarian Corporation, the Agricultural Supply & Services Corporation, the Food Market (MERCAL) and the Food Program in Venezuela.

Besides the new free food centers that will bring such centers to 5,000, already serving more than 700,000 needy Venezuelans, Chavez announced an expansion of MERCAL ... which subsidies food at 40% below market prices.

The Head of State said this was an example of what can be done under socialism: "in capitalism this is impossible because inequality is the rule ... there must be equality and inclusion and this will be achieved by socialism in the 21st century."

Venezuela Feeds Hungry with Oil Profits