During a press conference in Jamaica on Wednesday, Chavez stressed the importance of the first bilateral accord reached under the Petrocaribe initiative, which furthers regional integration.

Under the agreement, Jamaica will receive the 21,000 barrels of oil with up to 40 percent long-term financing and a two year grace period. As part of payment Venezuela will also accept products and services, particularly in the tourism field.

Previously Venezuela had supplied Jamaica with 7,300 barrels a day under preferential conditions. The new accord also includes the setting up of a refinery with the technology and specialized support from Venezuela's PDVSA oil enterprise. The project, a joint venture, will go under the name PetroJamaica.

President Hugo Chavez and Jamaica's PM Percival Patterson will meet with other Caribbean heads of state in Montego Bay on September 6.

Petrocaribe is comprised by its member nations: Antigua and Barbuda, the Bahamas, Belize, Cuba, Dominica, the Dominican Republic, Grenada, Guyana, Jamaica, Saint Vincent and the Grenadines, Saint Lucia, Saint Kitts and Nevis, Surinam and Venezuela.