President Hugo Chavez mocked U.S. concerns about Venezuela's ties with Iran on Tuesday, joking that while his adversaries worry about Iranian-made missiles lining his country's coast his government is actually erecting windmills there. 
 
 The socialist leader at first said missiles could be launched at Washington and other U.S. cities, then held up a photograph of windmills along the South American country's coast, saying "here they are." 
 
 "They are pointing directly at Washington," Chavez joked during a meeting with top government officials that was broadcast on state television. 
 
 Chavez _ an outspoken critic of Washington's foreign policy _ has previously poked fun at fears over Venezuela's increasingly close relationship with Iran, saying that in a joint bicycle factory the two countries are building the "atomic bicycle." 
 
 Chavez also condemned U.S. sanctions against Venezuela's state oil company for doing business with Iran. 
 
 President Barack Obama's administration slapped sanctions on PDVSA and six other companies from other countries for doing business with Iran that helps fund its nuclear program. The State Department said PDVSA delivered at least two cargoes of refined petroleum products worth about $50 million to Iran between December and March. 
 
 Venezuela's close ties with Iran have raised concerns among officials in Washington, who believe Iran is working on a nuclear weapons program. 
 
 Chavez has staunchly defended Iran's nuclear energy program, saying it is for peaceful uses only. 
 
 Under the sanctions announced last week, Petroleos de Venezuela, or PDVSA, will be barred from any U.S. government contracts, U.S. import-export financing, and export licenses for sensitive technology. But PDVSA will not be banned from selling oil to the United States or dealing with its U.S. subsidiaries. 
 
 Chavez said his government is preparing contingency plans to confront the possibility of more severe sanctions. 
 
 He did not provide any details of the contingency plans, but Energy Minister Rafael Ramirez has hinted that PDVSA could seek to accelerate initiatives aimed at diversifying PDVSA's clientele, exporting more crude to China and other countries to reduce Venezuela's dependence on the United States. 
 
 Venezuela is one of the United States' main suppliers of petroleum. 

 * Chavez has "cards up his sleeve" but no plans to play 
 
 * Laughs off report of missile base, says it's a wind farm 
 
 By Frank Jack Daniel 
 
 CARACAS, May 31 (Reuters) - Venezuela will not take immediate action against the United States in response to sanctions on its oil company PDVSA, President Hugo Chavez said on Tuesday after several days of marches against the "imperialist" measure. 
 
 "Our actions will depend on the actions they keep taking," Chavez said in his first appearance since Washington imposed mainly symbolic sanctions a week ago to punish Venezuela for sending shipments of a gasoline additive to Iran. 
 
 "We have an infinity of cards up our sleeves but have not played any of them," he said. 
 
 In previous spats, Chavez threw out the U.S. ambassador and threatened to cut oil supplies to his OPEC nation's main customer. Perhaps with an eye on the economic implications of a long fight over Iran ahead of his re-election bid next year, Chavez's words were more measured this time. 
 
 "The empire will decide if it takes the next step. They crossed a line," Chavez said in a televised cabinet meeting. "We are David, they are Goliath. 
 
 So far, the mild sanctions on PDVSA do not affect oil sales, access to U.S. financial markets or the company's subsidiaries and partnerships. Even so, the measures are unpopular with most Venezuelans, which favors Chavez as he prepares for a 2012 election. 
 
 U.S. President Barack Obama may come under renewed pressure from conservatives in Congress to impose tougher measures if Venezuela keeps ignoring U.S. restrictions designed to limit Iran's nuclear program. 
 
 The socialist Chavez joked about reports this month in a German newspaper that claimed Iran was building a missile base near Venezuela's main oil refineries. 
 
 "There are the Iranian missiles pointing at the United States," Chavez said, holding up photographs of a wind farm being built on the Paraguana peninsula. Some of the pictures showed dozens of wind turbine shafts flat on the ground, with the appearance of military hardware. 
 
 (Reporting by Frank Jack Daniel; Editing by Bill Trott)
– Poking fun at American fears about Venezuela's ties with Iran and irked by new sanctions, Hugo Chavez quipped about having missiles pointed at the US. "Here they are," he said, holding up a picture of windmills along the country's coast. "They are pointing directly at Washington." Chavez previously joked that an Iranian-Venezuelan bicycle factory project would be making "atomic bicycles," AP notes. Chavez slammed new American sanctions against Venezuela's state oil company for doing business with Iran, but said Venezuela would not respond immediately, reports Reuters. "We have an infinity of cards up our sleeves but have not played any of them," he said. The largely symbolic sanctions imposed by Washington allow Petroleos de Venezuela to continue selling oil to the US, but bar the company from holding US government contracts.