ICG, 22 Feb 07: Venezuela: Hugo Chavez's Revolution
...Three scenarios could trouble Chávez. The likeliest, at least in the next few years, is that problems will arise if oil prices drop to a point where the president can neither sustain current social spending, nor paper over the economic distortions produced by exchange rate and price controls, inflation and increasing dependence on imports....

...A second possibility is political recovery of the opposition to the point where it could take control of the National Assembly and provide a serious alternative. This is a distant prospect, since further splintering of the opposition has become apparent, but, in the event, the president might choose to use the considerable array of non-democratic tools he has amassed over the last eight years, and diehard Chavistas might be prepared to resort to violence to defend the regime....

...A third scenario involves a challenge to Chávez from within his movement. There are some fissures and tensions over where the president is taking the country, and at some point it is conceivable that elements within the administration might challenge Chávez´s handling of power....

...There is also the question as to what kind of country any non-Bolivarian president would inherit. If current trends continue, an opposition president would face a partisan military, the ultimate arbiter of power, with limited means by which to control it....

...As in Colombia and Mexico, there is an additional danger of crime, particularly drugs, creating a destabilising dynamic, corrupting institutions on a scale that causes the public to lose what little faith remains in the police and judiciary. Corruption of the armed forces, already evident, could also undermine security. More dangerous still would be a transformation of the armed, irregular Chavista groups into criminal mafias....

...Violent internal conflict is only potential in these scenarios and situations, not inevitable, but if President Chávez continues to polarise society and dismantle the checks and balances of representative democracy as he has for eight years, the risks are considerable.