www.abs-cbnnews.com

CARACAS, Venezuela - Six weeks into a strike against Venezuela's President Hugo Chavez, a solution to the political deadlock over his rule seemed no closer on Monday as fresh street clashes inflamed simmering tensions in the world's No. 5 oil exporter.

Police fired tear gas and a water cannon to disperse hundreds of Chavez supporters protesting against the strike in western oil-rich Zulia State. National Guard troops also repelled government sympathizers who attacked an opposition delegation with stones in central Caracas.

The clashes were the latest outbreak of violence in an escalating opposition strike aimed at forcing populist Chavez to resign. The shutdown has slashed Venezuela's vital oil exports, causing widespread domestic fuel and food shortages and jolting world energy markets.

U.S. oil prices rose 58 cents to $32.26 on Monday despite a pledge from the OPEC oil exporters cartel to increase output to compensate for the Venezuelan crisis.

But 43 days into the stoppage the government and opposition appeared no nearer to making a deal on elections that might restore stability to South America's largest oil producer.

International pressure is increasing for a solution to the conflict in Venezuela, which usually provides about 13 percent of U.S. oil imports. The crunch in Venezuela's petroleum supply comes as Washington prepares for a possible attack on Iraq.

Opposition leaders on Monday gave a lukewarm response to a fledgling initiative, first broached by Brazil, for a "group of friends" from regional nations to help broker an accord. Talks chaired by the Organization of American States have so far failed to reach an agreement on elections.

Chavez administration officials have welcomed the idea. The U.S. also last week backed the group of friends plan although it is not clear which nations would take part.

"We might agree to a group of friends, not of Chavez, not of the government, but of Venezuela, which are two different things. This initiative must be in tune with OAS negotiations," anti-Chavez union boss Manuel Cova told Reuters.

But other opposition leaders in Caracas questioned the initiative and said it could confuse negotiations.

Talks possible in Quito Timoteo Zambrano, an opposition negotiator visiting Washington, told Reuters that he opposed Brazil and Colombia taking part because they were neighboring countries. He mentioned Mexico, Peru and Canada as possible participants.

Brazil's leftist President Luiz Inacio Lula da Silva recently angered the opposition when he sent gasoline to Venezuela to offset shortages caused by the strike, a move Chavez foes described as unfriendly.

U.S. Ambassador to Venezuela Charles Shapiro said on Monday that presidents from the region could discuss the group of friends initiative when they meet in Quito on Wednesday for the swearing-in of new Ecuador president Lucio Gutierrez.

After traveling to Ecuador, Chavez is scheduled to hold talks with United Nations chief Kofi Annan in New York on Thursday, U.N. officials said.

Former paratrooper Chavez, elected in 1998, has faced an increasingly determined opposition campaign against his self-styled "revolution" for the poor since April when he survived a brief coup by rebel military officers.

But opponents say Chavez must step down for failing to deliver on his election vow to ease poverty in Venezuela, where most people benefit little from the nation's huge oil wealth.

Opposition leaders have promised to maintain the shutdown until Chavez quits. But the tough-talking leader has refused to step down. He has sent troops to control oil installations and threatened a crackdown on businesses, banks and schools involved in the strike.

Energy Minister Rafael Ramirez said on Monday the strike had cost Venezuela about $4 billion, battering an economy already in deep recession. Oil sales provide about half of government revenues.

Major private manufacturing industries, shopping malls and cinemas have stayed closed and most private schools have failed to open this year. But commerce is bustling in the center of Caracas. Even businesses in opposition strongholds have begun to open amid frustrations over the shutdown.

Accusing Chavez of corruption and dictatorial rule, his foes are demanding elections and also a nonbinding referendum on his rule on Feb. 2. They hope a referendum defeat for Chavez would give more weight to their call for elections.

But Chavez has challenged the referendum in the Supreme Court. He says the constitution only allows a binding referendum on his mandate in August -- halfway through his current term.

Please send your comments or feedback to newsfeedback@abs-cbn.com

www.miami.com Posted on Tue, Jan. 14, 2003 BY FRANCES ROBLES frobles@herald.com

CARACAS - Venezuela's national strike, 44 days long and aimed at forcing a new presidential election, has cost the government $4 billion, the energy minister said Monday night.

An alliance of business, oil and labor sectors declared strike here Dec. 2 in a quest to force the resignation of President Hugo Chávez. The former army paratrooper is accused by infuriated opponents of arming civilian militias and weakening democracy as he institutes a leftist revolution.

A staggering drop in oil production has cost the country $50 million a day in lost revenue, even as the government claims it is using retirees and ''patriot'' employees to bring production up to 800,000 barrels a day. Before the strike, the norm was three million barrels.

Among the costs of the strike, Energy and Mines Minister Rafael Ramírez cited imports of 2.2 million barrels of gasoline to satisfy domestic needs, at a cost $105 million. Anchored tankers whose captains refuse to sail cost $20,000 a day each, with a total price of $15 million, he said.

''These acts of terrorism and sabotage have had their consequences,'' he said. ``These are enormous losses, without including the enormous losses in the future.''

While the strike is faltering on the local business level, it has succeeded in devastating Petróleos de Venezuela, S.A., the state oil company.

''They have tried to stop food delivery -- they have not succeeded and will not succeed,'' Ramírez said of the opposition front. ``They have tried to create chaos -- they have not succeeded and will not succeed.''

Last week, Chávez claimed oil production was already up to 1.5 million barrels a day -- a figure most experts consider preposterous. Striking PDVSA managers said Monday's production was 413,000 barrels. Normally, 1.5 million barrels go to the United States alone.

''Let's just start by saying: The oil industry is on a work stoppage,'' said Juan Fernández, the company's former planning director, who says the government widely exaggerates its ability to break the strike. 'Mr. Ramírez referred to `sabotage.' Is he saying the 36,000 people on strike are sabotaging by remote control?''

Strikers have insisted they will continue the work stoppage until Chávez agrees to new elections. The president has refused, despite a nonbinding referendum called for Feb. 2 asking voters whether he should step down.

www.austin360.com By STEPHEN IXER Associated Press Writer

CARACAS, Venezuela (AP)--A strike that has almost paralyzed Venezuela's crucial oil industry is an act of ``terrorism'' that has cost the country $4 billion, the energy and mines minister said.

Strikers have tried to cause chaos and violence in our urban areas by impeding the supply of gasoline, diesel and domestic gas,'' Rafael Ramirez said in a televised address Monday. All these acts of terrorism have brought tremendous consequences for the nation.''

Once the world's fifth-largest oil exporter, Venezuela has had to pay $105 million to import more than 2 million barrels of gasoline since a general strike began Dec 2, Ramirez said. It's the first time Venezuela has imported gasoline in almost a century, he noted.

Venezuela's opposition parties and the largest labor union and business chamber called the general strike to pressure Chavez into calling early elections. The walkout is strongest in state oil monopoly Petroleos de Venezuela S.A., where 30,000 of 40,000 workers are off the job.

Oil provides half of government revenue and 80 percent of export earnings.

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

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.''

Chavez has fought back by firing at least 1,000 white-collar workers at PDVSA.

Ramirez said daily oil production now surpasses 800,000 barrels. Striking oil executives fired by Chavez say output is just over 400,000 barrels a day. Before the strike, production was up to 3 million barrels a day.

Some strike leaders were considering asking small businesses _ who say they cannot sustain losses much longer--to resume work, together with medical workers and teachers, hoping to avoid a popular backlash.

But the strike will continue in the oil industry, said Enrique Naime, a leader of the opposition Democratic Coordinator movement.

Most private schools and some public schools have been closed since the strike started. Hospital workers supporting the strike are only attending emergencies. Many supermarkets have run out of milk and are running low on staples 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.

William Davila, another Democratic Coordinator leader, said the food industry also should be given the freedom to ensure basic supplies.

But Davila said any easing of the strike should depend on a forthcoming Supreme Court ruling on the legality of a nonbinding referendum on Chavez's rule. The National Elections Council scheduled the vote for Feb. 2 after accepting an opposition petition signed by 2 million people.

Chavez says the nonbinding vote would be unconstitutional. His presidency runs until January 2007, and Venezuela's constitution says a binding referendum may be held halfway into his six-year term, or August.

During Monday's round of negotiations, which are sponsored by the Organization of American States, the two sides discussed the possibility of amending the constitution to allow early presidential elections, said OAS Secretary-General Cesar Gaviria.

www.globeandmail.com Bloomberg News Tuesday, January 14, 2003 – Page B22

Crude oil rose on expectations that extra oil from a production increase by the Organization of Petroleum Exporting Countries won't reach refineries in the United States until March at the earliest.

On Sunday, OPEC members agreed to boost their targets by 6.5 per cent next month to make up for export disruptions in Venezuela caused by a strike. Tankers take at least six weeks to reach U.S. refineries from Saudi Arabia, which has more spare capacity than other OPEC members.

"We've got supply problems and it doesn't look like they'll be solved any time soon," said Ed Silliere, vice-president of risk management at Energy Merchant LLC in New York, which markets gasoline and heating oil to local distributors. "The big worry continues to be Venezuela."

Wheat futures fell to their lowest in more than six months on expectations that U.S. farmers will boost their harvest at a time of weak export demand.

U.S. farmers raised their winter-wheat plantings by 6 per cent from a year earlier to 44.2 million acres, the highest in five years, the U.S. Department of Agriculture reported on Friday. It also pegged the wheat surplus on May 31, the end of the sales season, at 418 million bushels, or 20 per cent more than expected in December, because of poor sales.

Natural gas futures rose for a fourth session in five on expectations that colder weather in the U.S. Midwest and East over the next two weeks will spur a surge in heating demand.

Freezing temperatures are forecast this week from Chicago to Boston and as far south as New Orleans, according to the National Weather Service. The forecast signals increased furnace use that may trim gas supplies, already down 16 per cent from last year, traders said.

Jan. 10 to Jan. 25 will be the coldest two-week period since late 1995 and early 1996 from the Rocky Mountains to the Atlantic coast, AccuWeather senior meteorologist Bernie Rayno said on Friday.

www.thestar.com Jan. 14, 2003. 01:00 AM Two Norwegian oil fields idled Supply of crude remains very tight

NEW YORK—Oil prices moved back into positive territory yesterday as two oil field closings in the North Sea renewed worries about global supply despite OPEC's weekend decision to raise output.

The Organization of the Petroleum Exporting Countries at an emergency meeting on Sunday increased production limits by 1.5 million barrels per day (bpd), or 7 per cent, to compensate for six weeks of losses of strike-bound Venezuelan supplies.

Crude oil on the New York Mercantile Exchange settled 57 cents (U.S.) higher at $32.25 per barrel. In London, Brent crude broke through $30 a barrel to reach $30.20 a barrel, 53 cents up on the day.

News of two fires on Sunday that halted operations at the 232,000-bpd refinery in Garyville, La., operated by Marathon Ashland Petroleum LLC, helped lift gasoline prices in the United States by 2.41 cents to 89.60 cents a gallon, traders said.

Forecasts of a cold snap in the United States for the period Jan. 10-25 fuelled a rise in heating oil prices by 1.87 cents to 88.40 cents a gallon.

Dealers said the crude rally was triggered by news from Norwegian state oil producer Statoil that two North Sea oil fields shut down yesterday because of technical problems, cutting production by some 165,000 bpd — a minimal amount on a global scale.

"The fact that the North Sea output problem is supporting the market really shows how tight the physical crude supply is," said Lawrence Eagles of GNI Ltd., a broker of futures and options.

Fears that a U.S. assault on Iraq may be only weeks away are helping support prices that late last month hit a two-year high of $33.65 a barrel for U.S. crude.

"I certainly see (U.S.) oil staying above $30 until the Venezuelan situation is sorted out," said Paul Ashby, oil and gas analyst at ABN Amro in Sydney.

Oil from the Middle East takes four to six weeks to reach U.S. shores, while Venezuelan crude, which normally accounts for 13 per cent of U.S. imports, arrives in about five days.

"There are delays in getting oil from the Middle East to the United States, plus OPEC's agreement is for 1.5 million barrels per day; but prior to the strike Venezuela production was about 2.5 million," said David Thurtell, commodities strategist at Commonwealth Bank in Sydney.

Mexico's energy ministry said the country will raise crude oil exports by 120,000 bpd to 1.88 million bpd from Feb. 1 after the OPEC cartel agreed to raise its output. Non-OPEC Mexico is the world's eighth-biggest crude oil producer and one of the top four suppliers to the United States, along with OPEC members Saudi Arabia and Venezuela and non-OPEC Canada.

U.S. President George W. Bush viewed OPEC's decision to raise oil production as "a welcome step," White House spokesperson Ari Fleischer said yesterday.

"The president views OPEC's action to increase production, particularly given the protracted dispute in Venezuela, as a welcome step," he told reporters. "It will increase global energy supplies and support global economic growth."

But there are worries about how much of the extra oil OPEC can actually deliver.

The 1.5 million bpd increase was divided pro-rata among members — meaning Venezuela was also granted its share of the higher output limit despite the 43-day-old strike that has slashed its exports by 80 per cent to 500,000 bpd.

Many others in OPEC have little or no spare capacity to bump up production, leaving Saudi Arabia to provide the lion's share.

The kingdom has moved quickly to implement the OPEC decision, telling oil majors to expect 10-20 per cent more crude in February, industry sources said yesterday.

Crude traders said the hike had reversed Saudi Arabia's January cuts, made to clamp down on quota busting.

Riyadh fears an oil-price shock that would dent demand for its crude should a U.S.-led war in Iraq come before Venezuelan supplies are restored.

Venezuela, OPEC's third-biggest producer, is fifth in world exporter rankings, while Iraq sells up to 2 million bpd overseas under the United Nations oil-for-food program.