In a profession that prizes the illusion of reality, Hugo Chavez is one of politics' best -- a consummate actor whose connection with the Venezuelan masses has kept opponents off balance for 13 years. We never know if the Venezuelan president is putting us on.

So is he now?

For the last several months, Venezuelans have witnessed the drama of a cancer-stricken Chavez shuttling back and forth to Cuba for treatment, all the while taunting opponents seeking his ouster in October presidential elections. Last week, they were treated to scenes of the usually feisty Chavez in church, tears rolling down his cheeks, hands clasped in his parents', and beseeching Christ, "Don't take me yet." Meanwhile, a rumor went around that he was giving up on Cuba, and heading imminently for superior treatment in Brazil. Only to turn up yesterday in Havana, where he was met by Raul Castro.

"He is pulling all the stops for sympathy and will likely get it from his support base," a skeptical Stephen Johnson, director of the Latin America program at the Center for Strategic and International Studies in Washington, told me in an email exchange. He said:

Yet what all this theater means is very hard to determine, since few verifiable facts are available on what may be wrong with him. Offers of treatment in Brazil have been spurned before, either because he is not really ill, or because he really believes the best medicine is in Cuba.

We are watching the flow of events in Venezuela in large part because of the potential impact in the greater region, given Chavez's penchant for projecting influence through the use of the country's oil proceeds.

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Venezuela President Hugo Chavez's disclosure that his cancer has recurred raises hard questions about his ability to campaign for re-election in October. If he lacks the stamina or is incapacitated, what happens next -- will fair elections proceed, or will his ruling circle frustrate any potential transfer of power?

In short, if there is new leadership, can one imagine a shift in which Venezuela stops using its oil wealth to support a violent Colombian guerrilla movement? And will Venezuela lift constraints on oil production, and become a tipping point in the fast-changing geopolitics of oil?

The evidence to date is that Chavez, who has led Venezuela for 13 years, has prepared a tough strategy "to defend the revolution," says Stephen Johnson, director of the America's Program at the Center for Strategic and International Studies. The most recent datapoint came Monday, when a congressman's son was injured in a shooting by red-shirted Chavez supporters at a rally for opposition candidate Henrique Capriles Radonski.

The 39-year-old Radonski (pictured above), who is governor of Miranda state, appears to represent a serious popular threat to Chavez. He was elected as the united opposition candidate by a resounding majority last month. Among his platforms is a new day for the Venezuelan economy, fueled by a modern export oil industry pumping out far more crude.

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The war of tight oil: Are we in an age of oil plenty, or a stubborn era of scarcity? The folks with skin in the game are among those who cannot agree. At Citigroup, Seth Kleinman leads a group of analysts (including the venerable Ed Morse) who issued a note to clients this week declaring "the death of the peak oil hypothesis," a belief that there is a limit to how much oil can be produced. The actor in this murder is shale oil, the sister to shale gas, which is being unleashed from hard underground shale through the application of hydraulic fracturing. "The U.S. appears to be on course, after many weak starts, to achieve energy independence this decade," Kleinman writes. In a shot over the bow of doubters, the Citi team snickers at those who cannot notice the truth before their eyes: "We expect industry expectations to lag behind reality, just as they did with shale gas for many years." They go on to tally up how they see the new oil patch:

U.S. crude and product imports are now about 11 million barrels a day, with about 3 million barrels a day of product exports. This leaves import reliance at 8 million barrels a day. If shale oil grows by 2 million barrels a day, which we think is conservative, and California adds its 1 million barrels a day to the Gulf of Mexico's 2 million barrels a day, we reduce import reliance to 3 million barrels a day. Canadian production is expected to rise by 1.6 million barrels a day by 2020, and much of this will effectively be stranded in North America, and there is the potential to cut demand both through conservation and a shift in transportation demand to natural gas by at least 1 million barrels a day and by some calculations by 2 million barrels a day.

Voila, U.S. energy independence.

Not so fast, say the analysts at Barclays Capital, who issued their own, nearly simultaneous note to clients saying the opposite. The note, by Paul Horsnell and Amrita Sen, suggests that Barclays' clientele guard against "the near-euphoria surrounding the potential of oil shales in the U.S., together with a natural bias in the market to be overly optimistic on oil supplies." The oil market is extremely tight, made the more so by political upheaval, says the Barclays team. They write:

While posing some stirring prospects following almost a decade of dismal performance by non-OPEC supply, oil shales alone are simply not enough to offset the decline in other parts of non-OPEC and meet all the incremental demand growth. The scale of growth in U.S. output really needs to be put into perspective. North Dakota still only produces 0.5 million barrels a day, which in a weak year, incremental Chinese oil demand alone can consume all of and more. Does shale oil help the U.S. reduce its dependence on foreign oil? Yes, it does. But does it remake the U.S. into the next Saudi Arabia? No, at least not yet.

There you have it.

Go to the Jump for more of the Wrap.

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