www.sunherald.com Posted on Sat, Jan. 11, 2003 BY MICHAEL GEORGY AND ANDREW MITCHELL Reuters

VIENNA - OPEC producers prepared on Saturday for emergency talks that will decide how far to open the oil taps to prevent a price shock as war looms in Iraq.

Cartel ministers, meeting at 6:30 a.m. EST on Sunday, must also plug a gap in supplies from the group's third biggest producer Venezuela, hit by a six-week-old general strike.

Arriving in Vienna, influential Saudi Oil Minister Ali al-Naimi sent a strong message to world oil markets, where prices recently hit a two-year high, above $33 a barrel, for U.S. crude.

"There is a shortage. It is significant," said Naimi of the Venezuelan outage. "I can assure you that there will be no shortage." He predicted that oil prices "will be lower" after Sunday's meeting.

OPEC is under pressure from the United States to stop prices running out of control ahead of a possible U.S. attack against Baghdad, that some fear could be just weeks away.

Washington is worried that sluggish economic growth, having failed to respond to a series of interest rate cuts, could be snuffed out by another jump in energy costs.

"With oil stocks in the United States already close to estimated minimum operating levels, OPEC has been forced to act," said Washington's Petroleum Finance Company.

"The combination of the twin disruption scenarios represents a political nightmare of sorts for OPEC, which will be accused of having failed its mission if prices climb above $35 a barrel."

U.S. Energy Secretary Spencer Abraham, who normally avoids making public comment on OPEC, said on Friday he had been in contact with producers. He said they were readying a "substantial increase."

HOW MUCH?

Ministers must judge the volume of additional crude required to contain prices inside their preferred $22-$28 target range.

Kuwaiti Oil Minister Sheikh Ahmad al-Fahd al-Sabah has said the group is discussing a rise of 1.0-1.5 million barrels a day, up 4-7 percent on limits now of 23 million bpd.

Saudi Arabia, in control of most of the world's spare production capacity, wants an increase at the top end of the range.

Others including the UAE, Iran, Algeria and Libya are fearful that an end to the Venezuelan strike could push prices sharply lower and prefer just one million barrels daily.

Whatever the formal decision, Saudi is likely to raise flows by as much as it thinks is necessary for keeping crude under $30 -- to smooth diplomatic relations with Washington and prevent accusations in the Arab world that it is benefiting from war.

Riyadh sees its long-term interest in keeping prices under control to foster the world economic growth that fuels demand for its oil.

Already Saudi customers and shippers report preparations for extra deliveries, particularly to the United States, which relies on Venezuela for 13 percent of its imports.

Sunday's meeting will have to address the delicate issue of how to divide additional supply allocations.

Some want Venezuela excluded from a new deal, leaving nine members of OPEC to share out the incremental supply, giving those with spare capacity greater license to lift production.

Caracas is sending a powerful delegation headed by Oil Minister Rafael Ramirez and state oil company head Ali Rodriguez to argue against that strategy. It does not want to see its share of the OPEC pie shrink now for fear it fails to recover its full stake in the future.

Venezuela is expected to get backing for a request that new quotas be given temporary status, making it clear that previous limits be restored once its output recovers.

www.grandforks.com Posted on Sat, Jan. 11, 2003 CHRISTOPHER TOOTHAKER Associated Press

CARACAS, Venezuela - Supporters of Hugo Chavez planned rallies in the capital Saturday and opponents planned protests in several foreign cities after the Venezuelan president threatened to seize private food stocks and plants to end shortages.

Chavez warned businesses hoarding food on Friday that he might send troops to seize private property and distribute basic foodstuffs, which have begun to run low because of a six-week general strike.

Chavez supporters planned a show of support for the president in one of the capital's poorest districts, while opponents were staging a protest in the central city of Maracay, Venezuela's military center. Rallies also were planned in several foreign cities, including Washington, Toronto and London.

Chavez stopped short of giving an order, but had issued a decree in December allowing the military to temporarily confiscate private property to guarantee the flow of gasoline and other basic essentials.

Soldiers have since commandeered private gasoline trucks and National Guard troops seized 14 full gasoline tankers on Friday in the central state of Carabobo, the state news agency Venpres reported.

"This is an economic coup. They are trying to deny the people food, medicine and even water," Chavez told thousands of supporters in western Cojedes state on Friday. "They won't succeed."

The Venezuelan-American Chamber of Commerce told its more than 1,000 members to report any seizures of private property, saying such action would be illegal.

The president also said he fired 1,000 workers from the state oil monopoly Petroleos de Venezuela S.A., or PDVSA. An estimated 30,000 of the company's 40,000 employees have joined the strike.

Venezuela's opposition launched the strike Dec. 2 to pressure Chavez, who was elected in 1998 and re-elected two years later, to resign and call elections if he loses a nonbinding referendum on his rule.

Chavez insists Venezuela's constitution only permits a recall referendum on his presidency at the halfway-mark of his six-year term, or this August.

The strike has paralyzed the world's fifth largest oil exporter and caused fuel shortages while opponents stage daily street marches and urge tax evasion to force Chavez from office.

Meanwhile, many Venezuelans wait to see if disorganization and a lack of funding in Venezuela's elections council will dash opposition plans for a referendum Feb. 2.

The Chavez-dominated Congress has yet to authorize $22 million required for voting.

Alfredo Avella, president of the National Elections Council, said Friday the vote may be postponed to "a later date that permits the viability of the process."

Thousands of anti-Chavez protesters fought through tear gas and gunfire from pro-Chavez street toughs on Nov. 4 to deliver 2 million signatures to force the plebiscite.

Venezuelan law requires at least 10 percent of its 12 million registered voters to call a referendum.

Opposition leaders say they will pay for the referendum themselves if Congress refuses.

Many Venezuelans, however, say they won't contribute to the effort given that the nation is experiencing its worst recession in decades.

"The politicians asking for money are the same ones who robbed the country, and they are responsible for the economic crisis. Why should I give them any money?" said Manuel Arteaga, 45, who sells cigarettes on the sidewalks of downtown Caracas.

Other potential delays include organizing 180,000 volunteers to monitor voting booths, printing 12 million ballots, and protecting voting centers and materials.

While Chavez opponents wait for the ballot, the South American nation of 24 million is gripped with unrest.

Police used tear gas Friday to prevent pro- and anti-Chavez protesters from clashing in Venezuela's Margarita Island. Several children inside a nearby daycare were hospitalized, a local civil defense spokesman said.

Five people have died in protests since the strike began.

Negotiations to end the stalemate, led by secretary-general of the Organization of American States Cesar Gaviria and including officials from the White House, have made little progress.

www.canada.com Canadian Press Saturday, January 11, 2003

CARACAS (AP) - Allies of President Hugo Chavez called on supporters to rally in one of the capital city's poorest districts Saturday to celebrate government efforts to jump-start the state-run oil company hobbled by a 41-day general strike.

Venezuelans living abroad planned anti-Chavez demonstrations in several major cities one day after Chavez threatened to seize control of food-production facilities to deal with domestic food shortages.

Meanwhile, many Venezuelans are waiting to see if disorganization and a lack of funding in Venezuela's elections council will dash opposition plans for a referendum next month and hopes to weaken Chavez's presidency.

Chavez says the vote is illegal and the Congress has yet to authorize the funds required for balloting.

Alfredo Avella, president of the National Elections Council, said Friday the vote may be postponed to "a later date that permits the viability of the process."

Venezuela's opposition launched a strike Dec. 2 to pressure Chavez to resign and call elections if he loses the nonbinding referendum on his rule.

Chavez, a former paratrooper elected in 1998 and re-elected two years later, insists the constitution only permits recall referendum on his presidency halfway into his six-year term: this August.

The strike has paralysed the world's fifth largest oil exporter and caused fuel shortages while opponents stage daily street marches and urge tax evasion to force Chavez from office.

Chavez has refused to give in to opposition demands. On Friday, he told troops to be ready "to militarily seize the food production plants." He asked state governors belonging to his political coalition to be ready to co-operate.

"This is an economic coup. They are trying to deny the people food, medicine and even water," Chavez told thousands of supporters in western Cojedes state. "They won't succeed."

The Venezuelan-American Chamber of Commerce told its members that seizures of food plants would be illegal.

The president also said he fired 1,000 workers from the state oil monopoly Petroleos de Venezuela S.A., or PDVSA. An estimated 30,000 of the company's 40,000 employees have joined the strike.

Sunday January 12, 12:14 AM sg.biz.yahoo.com

VIENNA (Dow Jones)--State-run radio in Iran said Saturday that OPEC should "rush to help" Venezuela and that Sunday's meeting should offer solutions to the strike-hit country, the BBC's monitoring service reported Saturday.

Following phone talks between Venezuelan President Hugo Chavez and Iran's President Mohammad Khatami, a commentator on the Voice of the Islamic Republic of Tehran cited "America's war-mongering designs on Iraq" for volatile oil prices as well as the general strike in Venezuela.  

AdultsThe commentator said: "I believe that other OPEC members should rush to help that country, now that Chavez is facing serious oil production problems because of domestic difficulties and the indirect support of the American government for his opponents.

"Brazil has already announced that it will dispatch oil experts to that country and other OPEC members could perhaps also assess ways of helping the government of Venezuela to overcome its current problems. The OPEC session which is due to be held in Vienna tomorrow would be an appropriate venue for the raising of that matter and, undoubtedly, oil-producing countries could assess ways of bringing stability to oil prices, express their support for Chavez and display their unity to the world which could result in the further strengthening of the OPEC."

asia.cnn.com Sunday, January 12, 2003 Posted: 6:35 AM HKT (2235 GMT)

Colombian drivers waits in a long line to fill up at a gas station in Cucuta, located on the northeastern border with Venezuela.

CARACAS, Venezuela (AP) -- Lack of funding and disorganization in Venezuela's elections council could thwart opposition hopes to weaken Hugo Chavez's presidency in a referendum set for next month.

Chavez is opposed to holding the vote, arguing it's illegal, and the Chavez-dominated Congress has yet to authorize $22 million required for balloting.

Alfredo Avella, president of the National Elections Council, said Friday the vote may be postponed to "a later date that permits the viability of the process."

Venezuela's opposition launched a strike December 2 to pressure Chavez, who was elected in 1998 and re-elected two years later, to resign and call elections if he loses the nonbinding referendum on his rule.

Chavez insists Venezuela's constitution only permits recall referendum on his presidency halfway into his six-year term, or this August.

The strike has paralyzed the world's fifth largest oil exporter and caused fuel shortages while opponents stage daily street marches and urge tax evasion to force Chavez from office.

Chavez has refused to give in to opposition demands. He threatened Friday to deploy soldiers to seize control of food-production facilities to deal with domestic food shortages.

The former paratroop commander told troops to be ready "to militarily seize the food production plants." He asked state governors belonging to his political coalition to be ready to cooperate.

"This is an economic coup. They are trying to deny the people food, medicine and even water," Chavez told thousands of supporters in western Cojedes state. "They won't succeed."

The Venezuelan-American Chamber of Commerce repudiated the president's statements and told its members that seizures of food plants would be illegal.

The president also said he fired 1,000 workers from the state oil monopoly Petroleos de Venezuela S.A., or PDVSA. An estimated 30,000 of the company's 40,000 employees have joined the strike.

Thousands of anti-Chavez protesters fought through tear gas and gunfire from pro-Chavez street thugs on November 4 to deliver 2 million signatures to convoke the February 2 plebiscite. Venezuelan law requires at least 10 percent of its 12 million registered voters to call a referendum.

Opposition leaders say if they have to, they'll pay for the February referendum themselves. But many Venezuelans won't pay to vote during the nation's worst recession in decades.

"The politicians asking for money are the same ones who robbed the country, and they are responsible for the economic crisis. Why should I give them any money?" said Manuel Arteaga, 45, who sells cigarettes on the sidewalks of downtown Caracas.

Other potential delays include organizing 180,000 volunteers to monitor voting booths, printing 12 million ballots, and protecting voting centers and materials.

While citizens opposed to Chavez wait to go to the ballot, the South American nation of 24 million is gripped with unrest.

Police used tear gas Friday to prevent pro- and anti-Chavez protesters from clashing in Venezuela's Margarita Island. Several children inside a nearby daycare were hospitalized for asphyxiation, a local civil defense spokesman said.

Five people have died in protests since the strike began.

Negotiations to end the stalemate, led by Cesar Gaviria, secretary-general of the Organization of American States, have made little progress.

"There's no exit from this crisis without an agreement," Gaviria said after Friday's round of talks.

In Washington, the Bush administration was talking with OAS-member nations on ways to end the strike, White House spokesman Ari Fleischer said Friday.

"We remain deeply concerned about the deteriorating situation in Venezuela," Fleischer said. Asked about a possible U.S. role in a breakthrough, he said, "An electoral solution is the direction the United States sees."