Tuesday, January 14, 2003
US playing down talk of oil rift with Algeria
Posted by click at 12:09 AM
in
oil
www.middle-east-online.com
Algerian embassy in US says Algerian assistance to Venezuela's oil industry is commercial matter between two.
ALGIERS - US officials in Algeria have played down reports of a standoff between the two countries over the decision by Algiers to send experts to Venezuela to aid its strike-hit oil industry.
The official APS news agency said late Sunday that the US embassy had issued a statement here in the wake of a rash of reports in the Algerian press recounting a diplomatic uproar between the two nations.
"Contrary to these reports, the Algerian ambassador in Washington, Driss Jazairi, has not been summoned to the State Department," it quoted the embassy statement as saying.
Le Matin newspaper had reported Jazairi had been called to the State Department to hear of the White House's unhappiness with Algeria's "unacceptable meddling in Venezuelan affairs."
APS reported the embassy saying: "Algerian assistance to Venezuela's oil industry is a commercial matter between the two."
Venezuela has been rocked by a weeks-long crippling general strike aimed at ousting President Hugo Chavez from power.
OPEC energy ministers Sunday agreed to increase oil output by 1.5 million barrels per day to make up a shortfall in the market caused by fears of military action in Iraq and falling exports from strike-hit Venezuela.
What's in store now?
Posted by click at 12:08 AM
in
america
www.edinburghnews.com
Mon 13 Jan 2003
Peter Clarke
NOBODY knows what is going to become of Safeway. Today Sainsbury joined the bidding. Wal-Mart (Asda) can afford to pick up the supermarkets out of its petty cash. Allan Leighton, the former leader at Asda and now supremo at the Post Office, is also thinking of a bid.
This is all an exciting start to 2003 but unless you are an owner of Safeway shares the storm may seem remote. Yet it will touch as all.
Wherever the dice fall it seems our supermarkets will be given a creative shoogle to our wider pleasure with ever better bargains.
An unhappy strand to the story is the mysterious and capricious presence of The Competition Commission. Instead of trying to impede the market they should get out of the way.
If there are real barriers to competition it is through local councillors conspiring to stop new stores opening. The Commission simply refuses to look at the brutal cost impositions of the Common Agricultural Policy. It is too delicate to consider such matters.
Sir Ken Morrison, who started this rumpus by his cheeky bid for Safeway, must be chuckling. He no longer looks like a winner but what fun he’s had.
Prayer answered
THE markets are offering a collective prayer of thanks to Saudi Arabia for cajoling its OPEC cartel members to enhance the flow of oil. The problem is not Iraq, though that is adding jitters. The problem is the general strike in Venezuela. It is a weakness in the United States that it remains dependent on imported fuel when it has dozens of oilfields it has not opened to production.
It is possible the assault on Iraq will create some unexpected side-effects. One must be the application of new techniques to extract oil or enhance wind and water power sources. Oil will remain the dominant source of energy but it does look odd that the US regulates its own oil corporations so tightly it cannot extract its reserves.
The caricature is of a Texan President in the pocket of the oil giants. The reality is far more baffling and a little comical. Hugo Chavez in Caracas is almost as dotty a Saddam Hussein in Baghdad. Why is the world subject to such deranged people?
Stand in line
IN our hearts we think the railways’ days have gone. Yet the fans of metal tracks continue to beguile us. You would need a frozen soul not to be charmed by the scheme to link Edinburgh to Galashiels and then Carlisle by re-opening the old Waverley route. The arithmetic may be questionable but the idea is a delight.
Rather more arresting is to notion of reconstituting the Central Railway up from St Pancras through Leicester and up to Leeds and Manchester. The Central line was the last main route to be built in Britain and atrophied after World War One.
The idea is to rebuild it as a major freight artery that really will minimise lorry traffic. For the moment the project remains unadorned by detailed prices but instead of being an amusing steam line for a few railway buffs it could become a primary artery making a connection through the Channel Tunnel.
Most big projects wither under the sloth of planning procedures. The advantage of the Central line is that it needs no permissions. The Treasury need not spend any of our money. The markets are hungry for adventures.
AP News in Brief
www.nola.com
The Associated Press
1/13/03 7:10 AM
SEOUL, South Korea (AP) -- North Korea might get energy aid from the United States and other countries if it resolves concerns over its nuclear weapons development, a top U.S. envoy said Monday after meeting South Korea's president-elect.
Assistant U.S. Secretary of State James Kelly appeared to be offering an incentive to North Korea to give up its nuclear programs, though he did not say whether his comment represented a change in U.S. policy.
U.S. officials have previously said they would not reward North Korea for abandoning its nuclear programs, and that discussions of aid and better ties can only follow steps to dismantle those programs.
"Once we get beyond nuclear weapons, there may be opportunities with the U.S., with private investors, with other countries to help North Korea in the energy area," Kelly said at a news conference in Seoul.
One analyst said the Bush administration seemed divided over how to deal with North Korea, with some officials espousing dialogue and others opposing it.
Steve Case, an architect of merger that created AOL Time Warner, to resign as chairman in May
NEW YORK (AP) -- Blamed by shareholders for AOL Time Warner's sharp fall in fortunes, Steve Case said he will step down as chairman of the conglomerate he helped create -- a marriage of old and new media first hailed as revolutionary but now struggling for a future.
Case's departure means the company's leadership will be without any of the key architects of the blockbuster merger of America Online and Time Warner in 2001. The company said Sunday he would step down in May.
In a brief statement, Case said he had concluded AOL Time Warner was better off without him as chairman.
"Some shareholders continue to focus their disappointment with the company's post-merger performance on me personally," he said.
Analysts had speculated that an accounting scandal, along with anger about a drop of more than 60 percent in the company's stock price, would eventually force Case to resign. And his decision may have been hastened by recent reports of more financial problems at the company.
AOL Time Warner, which took a $54 billion charge last year to account for a decline in America Online's value, is expected to report another multibillion write-down later this month for the same reason -- possibly in excess of $10 billion, according to some analysts.
115 Palestinian minors killed in fighting last year, most by army fire
NABLUS, West Bank (AP) -- One hundred fifteen unarmed Palestinians younger than 18 were killed in 2002, an increase of more than 50 percent from the year before, according to an Associated Press count.
The toll underlines the military's failure to quell riots without killing civilians, particularly minors. Most of the youngsters killed in 2002 were stonethrowers or bystanders hit by Israeli army fire.
Palestinian militants, who target Israeli civilians, killed 36 Israeli minors in bombings and shootings last year.
Saying its soldiers operate in a hostile environment under threat from Palestinian militias, the Israeli government contends that gunmen often take cover behind civilians and that children and teens are sent to the front lines by cynical adults trying to win the world's sympathy by provoking casualties among the young.
However, Israeli human rights activists say Israeli soldiers often receive vague open-fire orders and are not punished if they overreact. "There is no culture of deliberately shooting children. There is a culture of impunity," said Lior Yavneh of the human rights group B'tselem.
Palestinians charge that the Israeli army does nothing to prevent killings of civilians because it wants to instill fear among Palestinians. "The rate of Palestinian children killed at the hands of Israeli soldiers is alarming and requires immediate international intervention," said Saeb Erekat, a Cabinet minister in the Palestinian Authority.
Espionage case appears headed for rare public trial
ALEXANDRIA, Va. (AP) -- Unless the government quickly negotiates a plea agreement with defense lawyers for a retired Air Force master sergeant, he'll become the focus of the first espionage trial in nearly 50 years that could end in a death sentence.
Jury selection was to begin Monday in U.S. District Court for Brian Patrick Regan, accused of offering satellite secrets to Iraq's Saddam Hussein and others for more than $13 million in Swiss currency.
Although a plea arrangement was possible, many experts said they would be surprised if the government agreed to a deal so near the trial's start.
"I think you can assume any offers that were put on the table have been long since rejected," said Lawrence S. Robbins. He was the losing defense lawyer in the last espionage trial, in 1997, when a federal jury convicted a married couple of spying for East Germany.
Regan's lawyers waged a late, unsuccessful fight to delay the trial because of a possible U.S. invasion of Iraq, one of the countries Regan was accused of offering to sell secrets to.
All sides said they expected jury selection to take as long as two weeks, mostly because of the death-penalty question.
Seven Palestinians, two Israelis killed in escalating violence ahead of Israeli election
JERUSALEM (AP) -- In rapidly escalating violence just two weeks before Israel's general election, seven Palestinians, two other Arab attackers and two Israelis were killed in raids and infiltrations in a 24-hour period.
Israeli Defense Minister Shaul Mofaz was evasive when asked about reports that he is planning to step up strikes against Palestinian militants. Mofaz said Israel is facing a growing wave of terror, but that there would be "nothing very much out of the ordinary" in Israel's response.
Palestinian officials have accused Prime Minister Ariel Sharon of escalating military action to deflect attention from corruption allegations that have been hurting his re-election bid. Two Israeli opinion polls indicated Monday that Sharon's Likud party is recovering somewhat from a monthlong drop in support.
Venezuelan president threatens to revoke TV broadcasting licenses as protests continue
CARACAS, Venezuela (AP) -- President Hugo Chavez threatened to revoke the broadcasting licenses of Venezuela's main TV and radio stations, accusing them of supporting opposition efforts to overthrow him through a six-week-old strike.
Chavez said the stations were abusing their power by constantly airing opposition advertisements promoting the strike, which has dried up oil revenue in the world's No. 5 oil exporter but hasn't shaken the president's resolve to stay in power.
Venezuela's main television stations have not broadcast any commercials during the strike except the opposition ads. Media owners say they adopted that stance because Chavez incites his supporters to attack reporters.
Venezuela's largest labor confederation, business chamber and opposition parties began the strike Dec. 2 to demand that Chavez resign or call early elections if he loses a proposed nonbinding referendum on his rule.
'Lord of the Rings,' a box-office favorite, gets two big honors at People's Choice Awards
PASADENA, Calif. (AP) -- "The Lord of the Rings: The Fellowship of the Ring" proved a crowd-pleaser at the 29th Annual People's Choice Awards, sharing the favorite motion picture award with co-nominee "Spider-Man" and winning in the best dramatic motion picture category.
The "Fellowship of the Ring" captured the two top awards while its sequel, "The Lord of the Rings: The Two Towers," was topping the box office.
At the awards ceremony Sunday night, Mel Gibson was named favorite motion picture actor and Julia Roberts won the favorite actress award, her ninth win in the category.
Jennifer Aniston also made a return engagement as favorite female television performer for her role as Rachel on "Friends," which also won in the favorite comedy series category.
Ray Romano took home the favorite male television performer prize, and "CSI: Crime Scene Investigation" dethroned longtime top vote-getter "ER" in the favorite television drama series.
Country singer Faith Hill and rap sensation Eminem were named as favorite musical performers.
Raiders beat Jets, 30-10, to head to AFC championship game
OAKLAND, Calif. (AP) -- In blowing out the mistake-riddled New York Jets 30-10 Sunday, the Oakland Raiders advanced to the AFC title game against Tennessee next weekend. Counting the AFL, it is the 14th time the Raiders have gotten this far.
After a 10-10 halftime tie, the Raiders rattled Chad Pennington, the league's most efficient and seemingly unflappable quarterback. And they got big plays from league MVP Rich Gannon throwing to Jerry Porter and Jerry Rice.
Oakland came away with its eighth victory in nine games, getting Zack Crockett's 1-yard TD run after Pennington's first fumble; Gannon's two touchdown passes; and three field goals (29, 34 and 31yards) from Sebastian Janikowski.
The Tampa Bay Bucaneers go to Philadelphia for next Sunday's NFC championship game against the Eagles, who ended the Bucs' season in the first round of the playoffs at Veterans Stadium the past two years.
FUTURES MOVERS - Oil gains on output concerns - OPEC to raise output 6.5%; some fear it's not enough
cbs.marketwatch.com
By Myra P. Saefong, CBS.MarketWatch.com
Last Update: 4:11 PM ET Jan. 13, 2003
NEW YORK (CBS.MW) -- Oil prices climbed back above $32 a barrel Monday, with traders expressing doubt that OPEC's increase in production of 1.5 million barrels per day would arrive fast enough or be sufficient to cover the shortfall from Venezuela's oil strike.
The output increase of 6.5 percent, to 24.5 million barrels a day, is to take effect Feb. 1, the oil cartel said. OPEC also said it would review the decision at its next regularly scheduled meeting in March. Read full story.
February crude closed at $32.26 a barrel on the New York Mercantile Exchange, up 58 cents, after falling to a low at $31.13 earlier in the session. In London, the Brent contract on the International Petroleum Exchange rose 53 cents to $30.20.
"This increase should be enough to keep the Venezuelan disruption in check," Tyler Dann, an analyst at Banc of America Securities, told clients Monday, "assuming that OPEC is able to fully increase actual production volumes by the amount of this quota change and combined with the release of extra inventories maintained by certain members of the organization."
Alaron.com senior energy analyst Phil Flynn said that the increase is "great," though it comes "too little, too late to ease this current supply crisis developing in the U.S. and throughout the world."
The latest production hike won't take effect until Feb. 1, and it'll take five or six weeks for the extra oil to reach the U.S. Prior to the meeting, cartel members said the quota limits could change if the situation in Venezuela is resolved.
"The increase to go into effect two weeks from now will do little to ease tightness and in fact, in two weeks our supply levels will fall to critically low levels," Flynn said.
He added: "We're falling further and further behind to replenish our stock levels ... losing 2 million to 3 million barrels per day from Venezuela."
That adds up to 14 million to 21 million barrels per week and in five weeks, a loss of some 70 million to 105 million barrels, Flynn said.
On that note, the OPEC hike "will not bring that many incremental barrels into the market to make up for production lost as a consequence of the Venezuelan crisis," Mike Fitzpatrick, an analyst at Fimat USA, told clients Monday.
Venezuela's strike began on Dec. 2. Production there dropped below 200,000 barrels per day at its lowest point, from the usual 3 million barrels per day. Opponents of President Hugo Chavez have been calling for his resignation or for new presidential elections.
Supplies can't cover loss of Iraq output
Oil production from Iraq could also be removed from the global market if war breaks out with the U.S., as expected within the next two months, said Dann. Iraq exports about 2 million barrels per day under the U.N.'s food-for-oil program.
If Iraq exports are affected, OPEC would "likely need at least some help from non-OPEC producers to keep the market from overheating," Dann warned.
Analysts say they're concerned about OPEC's ability to cover lost oil in the event of a U.S. war with Iraq on top of Venezuela's shortfall. Analysts pegged OPEC's spare capacity at around 3 million barrels, which would fall short of covering a total of around 5 million barrels lost from OPEC members Venezuela and Iraq. See related story.
During Sunday's meeting, cartel members said they could provide another 4 million barrels to the market, "which is a bit more spare capacity than generally thought," said Fimat analyst John Kilduff.
The cartel "remains determined to take whatever measures, as and when deemed necessary, to maintain oil price and market stability, and states that the market will be continuously and carefully monitored," according to OPEC's agreement Sunday. OPEC set its next meeting for March 11 in Vienna.
"Prices have not reacted [much] because a production deficit remains with Venezuela's 2 million barrel per day product off the market," said Kilduff.
For now, Fimat expects that "the market will continue to react nervously to headlines waxing and waning between psychologically important $30 and the recent high of $33.65," Fitzpatrick said.
"With war looming and the Venezuelan loss just balanced at the low end of a comfortable range for global inventories," Banc of America's Dann expects prices to remain "at least in the high $20s, if not in the $30s in the near-term."
High prices on tap
As the potential war with Iraq draws near, however, "consumers should expect some of the highest crude oil and gasoline prices and heating oil prices since 2000," said Kilduff.
In 2000, retail gasoline prices reached $2 and "the spike in energy prices had a hand in the economic slowdown that the global economy is continuing to emerge from," he said.
Tom Kloza, chief oil analyst at The Oil Price Information Service pointed out that the gasoline industry normally has a "tough time handling the transition from winter to summer blends and they will have real problems if there is no Venezuelan refinery production or a limping industry [from refinery maintenance and outages] at the time."
The situation is Venezuela "cannot be overstated," Kilduff said, given that the chemical composition of the country's crude oil is "unique and cannot be easily interchanged with the lighter, sweeter Middle Eastern crude."
"Iraq is a further price spike for another day," he said.
Also Monday, two oil fields in the North Sea were shut down due to technical problems. The fields account for about 165,000 barrels per day of production "which is not much," said Dailyfutures.com President Todd Hultman, "but the news caught the market at a nervous time."
Against this backdrop, February unleaded gasoline climbed 2.71 cents to 89.91 cents a gallon. February heating oil closed at 88.38 cents a gallon, up 1.85 cents.
Meanwhile, concerns over the eventual rise in oil market supplies pressured most oil-service stocks. The Oil Service Index ($OSX: news, chart, profile) closed down 2.4 percent. See Energy Stocks.
In other energy news, February natural gas rose 10.8 cents to $5.251 per million British thermal units "as much of the U.S. braces itself for the coldest weather of the season," according to Fitzpatrick.
Nymex gold futures close flat
Gold futures prices closed little changed Monday, holding above $355 an ounce amid uncertainty over North Korea and volatility in the broader U.S. stock market. See Metals Stocks.
Soybean futures fall
Over on the Chicago Board of Trade, soybean futures fell, pressured by rain in Brazil over the weekend that'll likely benefit crops, according to Todd Hultman, president of commodity information provider, Dailyfutures.com.
March soybeans fell 8 3/4 cents to 548 cents a bushel. March wheat also declined 8 cents to close at 311 1/4 cents a bushel, and March corn slipped 4 1/4 cents to 230 1/2 cents a bushel.
Hultman said last week's export inspections were twice the estimated pace for soybeans at 32.5 million bushels.
Meanwhile, wheat inspections were roughly as estimated at 19.7 million bushels and corn was below the expected pace at 28.1 million bushels.
Corn was pressured after the government Friday raised its estimates for stocks at the end of the 2002 to 2003 year by 81 million to 924 million bushels, Hultman said.
The Reuters/CRB Index, broad-based measure of the commodity futures market, closed at 239.2, down 0.4 percent.
Myra P. Saefong is a reporter for CBS.MarketWatch.com in San Francisco.