sg.biz.yahoo.com Tuesday January 14, 3:37 AM 01-13-03 1416ET

CARACAS -(Dow Jones)- Venezuelan state oil company Petroleos de Venezuela SA (E.PVZ), or PdVSA, on Monday lost the services of oil tanker Astro Canopus because it didn't pay its bill, an executive at an international crude oil charter company said.

The Astro Canopus had been on a three-year time charter to PdVSA, the executive told Dow Jones Newswires on the condition of anonymity.

PdVSA officials didn't return calls with requests for comment.

The loss comes as PdVSA scrambles to find tankers to move crude oil so it can uncap more wells it was forced to shut because of an ongoing 43-day-old general strike against President Hugo Chavez's leadership.

(MORE) Dow Jones Newswires

01-13-03 1419ET

Venezuela PdVSA Loses Chartered Tanker For Nonpayment -3

International shipping agencies will boycott Venezuelan ports because their insurance carriers have refused to guarantee coverage as long as the strike continues, said the executive, whose agency loaded "one or two ships a week" in Venezuela.

"We've been told there are no qualified pilots, and we're not sure if there are people to moor the ships. The insurance companies have said they're not sure the ports are safe," he said.

The government has tried to replace harbor pilots and tug boat captains but industry insiders have said they don't have the licenses required to operate at the country's terminals.

"Currently, we could get to Venezuela and be told (by insurance companies) we can't load because it's too risky...so we won't be going there until the strike's over and everything settles down," he said.

Without chartered tankers, PdVSA is restricted mostly to using its own eight tankers, which limits exports to about 9 million barrels per month versus almost 10 times that in November before the strike began, according to Ciro Izarra, who was the international crude trading manager at PDVSA before the strike began.

And that's seen continuing to limit PdVSA's ability to uncap wells because there's simply nowhere for the oil to go once it comes out of the ground.

Observers have said the company is currently pumping about 400,000 barrels per day, which is close to what Izarra estimated PdVSA can ship with its own fleet.

Opposition leaders are demanding President Hugo Chavez agree to call elections in 30 days if he loses a Feb. 2 nonbinding vote on whether he should remain president.

Chavez has thus far maintained the constitution only requires him to accept the results of a possible recall referendum next August, the midpoint of his term.

Chavez's critics blame his left-leaning policies for the country's deepening economic crisis, as the economy likely contracted about 8% last year amid unemployment of 17% and inflation of 31% sparked by the bolivar's ($1=VEB1513.25) 46% devaluation.

Chavez has said the country's problems are due to an "economic coup" led by his opponents.

PdVSA Web site: www.pdv.com

-By Jehan Senaratna;Dow Jones Newswires; 58212 564 1339; jehan.senaratna@dowjones.com

www.newsday.com By ALEXANDRA OLSON Associated Press Writer

January 13, 2003, 5:40 PM EST

CARACAS, Venezuela -- Venezuelan opposition leaders said Monday they were considering asking doctors, teachers and small business owners to return to work, saying aspects of the 43-day-old walkout could become "counterproductive."

But the strike will continue where it matters most, in the key oil industry, said Enrique Naime, a leader of the opposition political movement Democratic Coordinator. The industry provides half of government revenue and 80 percent of export earnings.

"The oil people are insisting they aren't going to cede," Naime said. "The strike will continue but it's important to continue without kicking goals into our own net."

The opposition is worried that suffering caused by the strike could lead to a popular backlash, even though it says it has taken measures to ensure there are no acute shortages of essential goods.

Most private schools and some public schools have been closed since the strike began Dec. 2. Hospital workers supporting the strike are only attending emergencies. Many small businesses complain they can't sustain losses much longer. Gasoline and bank lines are long; gas shortages have disrupted commerce. Many Caracas supermarkets have run out of fresh milk and are running low on basics such as flour and drinking water. Many medicines no longer are available at pharmacies.

"At this moment, the doctors' strike could be counterproductive, just like the educational strike could be counterproductive," Naime said.

He said strike leaders were considering asking medical workers, teachers and small business owners to resume work.

William Davila, another Democratic Coordinator leader, said the food industry also should be given the freedom to ensure supply. But Davila said any easing of the strike should depend on a pending decision by the Supreme Court on the legality of a nonbinding referendum of Chavez's rule. The National Elections Council has set the referendum for Feb. 2.

The strikers are trying to force Chavez to accept a nonbinding referendum on his rule. Chavez's presidency runs until January 2007, and Venezuela's constitution says a binding referendum may be held halfway into his six-year term, or August.

Chavez's opponents cite a clause in the constitution that allows citizens to petition for referendums on "matters of national importance" at any time. They delivered 2 million signatures asking for the vote.

The strike is strongest in the state oil monopoly, Petroleos de Venezuela S.A., where 30,000 of 40,000 workers are striking. The government fired at least 1,000 managers. Energy and Mines Minister Rafael Ramirez said the government will bring oil production back to 2.5 million barrels a day by mid-February.

Once the world's fifth largest oil exporter and No. 4 supplier to the United States, Venezuela now exports less than 300,000 barrels a day, according to striking executives. The government says exports are 800,000 a day.

According to the Lundberg Survey of 8,000 U.S. service stations, Venezuela's strike has helped raise U.S. gasoline prices by 5 cents per gallon in the past three weeks to an average $1.50 a gallon.

Citing scarce gasoline imports from Venezuela, the U.S. Energy Department said American motorists could pay up to $1.54 per gallon of gasoline this spring even if war is averted in Iraq.

"The market underestimated the tenacity of the Venezuelan strikers," said Phil Flynn, head of the energy trading desk at Alaron Trading Corp. on the Chicago Mercantile Exchange. "People are finally starting to wake up not just to the strike but also to Venezuela's importance as a U.S. supplier."

In Maracaibo, 340 miles west of Caracas, police used tear gas to keep pro- and anti-Chavez rallies apart. National Guard troops used tear gas to stop a small clash in Caracas.

Chavez -- who purged the military of dissidents after a brief April coup -- has sent troops to seize striking oil tankers, commandeer gasoline trucks and lock strikers out of oil installations. Last week, he threatened to send soldiers to seize food production plants participating in the strike and fire or jail striking teachers.

"We are spending millions of dollars to import food," Chavez said Friday. "I can't allow the people to be strangled by hunger. I can't allow children to die because there are no medicines, or no milk."

cbs.marketwatch.com By Craig Tolliver, CBS.MarketWatch.com Last Update: 3:11 PM ET Jan. 13, 2003

CHICAGO (CBS.MW) -- The founder of the Templeton Funds once said, "Outperforming the majority of investors requires doing what they are not doing." His solution: buying when pessimism is at its maximum.

Putting John Templeton's dictum to the test, Morningstar is out with its annual survey of "unloved funds" that saw last year's biggest loss of assets under management. The Chicago-based fund tracker first introduced the study in 1996, after tracing fund flows back to 1987.

Morningstar discovered that the funds from the most unpopular asset classes each year outperform the average equity fund over the following three years more than 75 percent of the time.

Moreover, unpopular funds have outpaced popular ones more than 90 percent of the time.

"Buying one fund from each of these categories and sticking with them for a few years has been a profitable investment for those who have the patience and willpower to handle contrarian investing," said Christine Benz, editor of Morningstar FundInvestor.

This year's least popular fund categories include:

• Latin America: For the second straight year, Latin America funds got no love from investors, thanks to concerns over Brazil's political and economic volatility and continued instability in Argentina and Venezuela, Morningstar noted.
• Utilities: Enron and the California energy debacle; WorldCom and the general blowup of the telecom sector topped the agenda.
• Financials: Money-center banks, asset managers and brokerages were stung from the three-year bear market. Seemingly unnoticed, however, were funds focusing on regional banks, which had a stellar year -- such as Senbanc (SENBX: news, chart, profile), up nearly 19 percent in 2002. See table below.

"We understand that some investors may be skeptical about funds in these categories, but we believe they're likely to turn around in the upcoming years," Benz said.

"While the categories that are garnering the most new inflows these days -- precious metals, small-value, and real estate funds -- may seem more appealing, our research indicates funds from unloved categories for a given year actually outperform popular fund categories during the three following years," Benz added.

For those that find the Unloved Funds theory intriguing, Morningstar offers the following advice:

Buy one fund from each of the three unpopular groups

Not every downtrodden category will rally during the next three years, so diversifying with a small stake in each group can be key. For example, Latin America funds, which Morningstar named as one of its unloved categories in early 2000, have continued to lag, while precious-metals funds have been strong. Exposure to all three categories increases the chances for market-beating returns.

Hold for three years

Don't expect instant results. Gold fund investors in early 2000 might have been tempted to dump them after losing an average 17 percent that year. But, metals funds went on to garner large gains in 2001 and 2002.

Limit the investment

Since unpopular categories frequently dabble in highly volatile markets, limit exposure to these funds to no more than 5 percent of your portfolio. And while the strategy has been highly successful, it's not foolproof.

In 1995, for example, Morningstar suggested investors buy funds in the communications, precious metals, and European-stock categories. Because of a terrible showing from the precious-metals funds, the unpopular group posted a three-year annualized return of only 10 percent -- half the gain of the popular funds.

If possible, buy soon

Morningstar studies have shown that, generally, investors can buy the funds up to a year later and the strategy still works. However, all three unpopular categories for 2002 are vulnerable to market-timers, so in this case, the analyst suggests buying while stock prices are low -- before timers can swoop in and push prices up in a hurry.

Top performing Unloved Funds

The funds below were the best performing funds of their respective "unloved" asset classes and are provided for reference and not as a recommendation from Morningstar.

Latin America Name Ticker 2002 Return 3-Yr Return Templeton Latin Amer (TELAX: news, chart, profile) -16.98 -9.56 T. Rowe Price Latin Amer (PRLAX: news, chart, profile) -18.10 -10.14 Scudder Latin Amer (SLAFX: news, chart, profile) -18.28 -11.90 Latin America Category -20.18 -13.77

Source: Morningstar, data annualized through December 2002

Utilities Name Ticker 2002 Return 3-Yr Return Franklin Utilities (FKUTX: news, chart, profile) -10.48 5.23 Eaton Vance Utilities (EVTMX: news, chart, profile) -12.50 -8.93 Principal Utilities (PUTLX: news, chart, profile) -12.73 -9.51 Utilities Category -23.81 -12.86

Source: Morningstar, data annualized through December 2002

Financial Services Name Ticker 2002 Return 3-Yr Return Senbanc (SENBX: news, chart, profile) 19.79 18.96 FBR Small Cap Financial (FBRSX: news, chart, profile) 18.68 24.86 Burnham Financial Svcs (BURKX: news, chart, profile) 17.55 32.42 Financials Category -10.58 4.25

Source: Morningstar, data annualized through December 2002 Craig Tolliver is the mutual funds editor for CBS.MarketWatch.com in Los Angeles.

www.examiner.com Publication date: 01/13/2003 BY BRUCE STANLEY Associated Press

    VIENNA, Austria -- OPEC members agreed Sunday to boost the cartel's oil production target by 6.5 percent to stabilize a world market jittery over a crisis in Venezuela and the possibility of war in Iraq.

    The increase of 1.5 million barrels a day -- to 24.5 million barrels -- would take effect Feb. 1, OPEC President Abdullah bin Hamad Al Attiyah told a news conference at the group's headquarters in Vienna.

    Al Attiyah confirmed that the Organization of Petroleum Exporting Countries wants to keep prices of its benchmark blend of crudes at $22-$28 per barrel. Friday prices hovered around $30.

    Earlier in the day, Saudi Arabian Oil Minister Ali Naimi said the ceiling should remain at 23 million barrels. Saudi Arabia is OPEC's most influential member and has the bulk of the cartel's spare production capacity.

    OPEC said it wanted to calm fears of a supply crunch caused by an ongoing strike in Venezuela. The agreed output hike was near the upper end of what analysts expected.

    The strike, launched Dec. 2 by political opponents seeking to oust President Hugo Chavez, has slashed Venezuela's exports by about 2 million barrels a day. Venezuela normally is OPEC's third-largest producer and a major oil supplier to the United States.

    "OPEC is trying to send a very strong message that it will do its utmost to stabilize demand and supply," Al Attiyah said after delegates reached their decision in informal talks.

    "Now we will wait for the market to react."

    The United States praised the move, saying the hike would support economic growth and stability.

washingtontimes.com

     NEW YORK, Jan. 13 (UPI) -- Stock prices on the New York Stock Exchange and the Nasdaq Stock Market were mixed, ending near the flat line in trading Monday, pressured by weakness in the oil patch.

     The blue-chip Dow Jones industrial average, which rose 8.71 points Friday, rose 1.09 points to close at 8,785.98. The tech-heavy Nasdaq composite index, which gained 9.26 points in the previous session, ended down 1.64 points to close at 1,446.08.

     The broader New York Stock Exchange composite index fell 0.59 to close at 5,206.10 while the Standard & Poor's 500 index lost 1.30 points to close at 926.27.

     The American Stock Exchange composite index dropped 6.90 points to close at 826.54 while the Wilshire 5000 Index dropped 12.78 points to close at 8,745.65.

     Volume was 1.65 billion on the Big Board and 1.53 billion on the Nasdaq Stock Market.

     Analysts said stocks reversed gears around midday amid a decline in oil stocks, a slew of fresh corporate news and broker downgrades.

     Oil prices came under pressure after the Organization of Petroleum Exporting Countries agreed Sunday to increase crude production by 1.5 million barrels a day, or 6.5 percent, to 24.5 million in a bid to lower prices and offset shortages resulting from a strike in Venezuela. Oil service stocks were the biggest losers.

     On the corporate front, Duke Energy, the nation's second-largest utility owner, said its 2002 earnings fell more than expected because of a damaging ice storm, job cuts and a decline in power prices and trading. Profit, excluding some expenses, was about 10 cents less than its previous estimate of about $1.95 a share.

     Meanwhile, brokers at J.P. Morgan Securities Inc. said personal-computer sales may be weak as customers fail to upgrade their systems, and prices may be further reduced. The firm lowered Dell Computer, the world's largest PC maker, to neutral from overweight.

     Brokers at Thomas Weisel cut their rating on Johnson & Johnson's stock from buy to attractive, citing concerns about the healthcare-pharmaceutical giant's business.

     Brokers at CSFB downgraded Motorola to underweight from neutral and cut its price target to $8 a share from $11, saying the fundamental risks outweigh the potential rewards at the current valuation.

     The firm also said it thinks entertainment and media stocks are likely to outperform the broader market in 2003, with advertising in an upturn mode.

     And, AOL Time Warner came off its best level as investors digested news that Chairman Steve Case resigned Sunday in a move he said was "in the best interest" of the troubled media giant. Case will remain as a director of the company with responsibility for corporate strategy.

     With Case stepping down, it's possible that the company will take quick, decisive action to solve the 2-year-old problem with its troubled America Online division, experts said.

     Intel Corp. slipped ahead of Tuesday's release of its earnings. The chip giant is expected to report earnings of 14 cents a share.      In other corporate news, Georgia-Pacific Corp. warned that its fourth-quarter profit would come in well below Wall Street's consensus forecast.

     Wall Street's forecasters are bullish about the outlook for corporate earnings in the fourth quarter, but their views get less rosy the farther they gaze into their crystal balls.

     The earnings flood hits tidal wave proportions on Thursday, with reports expected from BankOne, Delta, EBay, General Motors, FleetBoston, Sears Roebuck, Sun Microsystems, United Technologies and Wachovia, among others.

     Meanwhile, a full plate of economic data awaits investors starting with retail sales and import/export prices on Tuesday.

     The Fed's Beige Book comes out on Wednesday, along with the producer price index and business inventories.

     Jobless claims and the consumer price index come on Thursday. The week wraps up with international trade, industrial production and, importantly, consumer sentiment.

     Meanwhile, U.S. Treasury prices rose. The 10-year bond added 2/32 to 99. Its yield, which moves in the opposite direction of its price, fell to 4.12 percent from 4.13 percent late Friday.

     In Europe, stock prices ended lower in London, but rose in Frankfurt and Paris in moderate trading. The London International Stock Exchange's blue-chip FTSE-100 index lost 37.0 points, or 0.9 percent, to 3,937.1. The German DAX index rose 33.77 points, or 1.1 percent, to 3,071.1 and the French CAC-40 index added 9.69 points, or 0.3 percent, to 3,169.82.

     Analysts said German and French stocks were supported by strength in telecommunications companies after France Telecom's stock was upgraded and news of a bond issue.

     Brokers at Goldman Sachs upgraded the stock and France Telecom said it was planning a $3.18 billion bond issue. Goldman also upgraded the European telecom sector to attractive from neutral.

     German issues were led higher by Deutsche Telekom and automakers. Analysts said German carmakers benefited from data Friday that hinted at better export potential.

     In Asia, prices ended higher in moderate trading on the Hong Kong Stock Exchange, lifted by strength in China-related issues. The blue-chip Hang Seng Index, which rose 46.09 points during the previous session, jumped 112.58 points, or 1.2 percent, to 9,834.08.

     Analysts said stocks were lifted as investors acquired an appetite for China-linked issues amid the uncertain global outlook.      Elsewhere, stocks ended higher on the South Korean Stock Exchange, lifted by strength in oil stocks. The Korea Composite Stock Price Index, or Kospi, which fell 2.04 points during the previous session, gained 19.52 points, or 3.1 percent, to 648.06.

     Analysts said the market also drew support from developments over the weekend to ease the crisis in North Korea.

     Prices on the Taiwan Stock Exchange rose to their highest level in more than five months. The key Weighted Index, which rose 37.07 points during the previous session, jumped 140.41 points, or 2.9 percent, to 4,991.26 on hopes for renewed technology spending in the United States.

     Meanwhile, Singapore stocks ended higher for the fourth consecutive session in moderate trading. The key Straits Times Index, which rose 12.08 points during the previous session, rose 38.88 points, or 2.9 percent, to 1,386.05.

     Elsewhere around the Pacific region, prices ended slightly higher in light trading on the Australian Stock Exchange. The blue-chip All Ordinaries Index, which slipped 0.60 points during the previous session, rose 7.40 points, or 0.2 percent, to 3,042.50.

     Meanwhile, markets in Japan were closed for a public holiday. Trading will resume on Tuesday with the Nikkei Stock Average hovering around 8,470.45 after losing 27.48 points last Friday.