Obama Underwrites Brazil's Oil Drilling

As the WSJ explains, Obama is unwilling to allow oil drilling in the U.S. (even as Russia, China, and Spain drill off the coast of Florida), but he is willing to lend $2 billion to Brazil so that Petrobras can drill for oil off its own coastline.

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-Im 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.

I'm sure ExxonMobil would get the same cheap government-backed debt for its drilling plans if it simply asked nicely.