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Russia can play a leading role in stabilizing global oil markets as prices continue to surge amid fears of war in Iraq and a strike in Venezuela, OPEC Secretary General Alvaro Silva-Calderon said in an interview published Wednesday. "Russia can now play an extremely important role," Silva-Calderon told the Vremya Novostei daily, while urging closer cooperation between Russia and the oil cartel. Russia, one of the world’s top oil exporters but not a member of the Organization of Petroleum Exporting Countries, earlier this month pledged full cooperation with OPEC to boost deliveries and stem the steady rise in world prices.

"Moscow expresses a permanent wish for cooperation, with the goal of stabilizing the world’s oil market," Silva-Calderon told the daily. Russian Energy Minister Igor Yusufov pledged Russia’s cooperation during a visit to Kuwait last week, saying that Moscow was ready to provide Venezuela with tankers to export oil in the face of its six-week-long strike. Silva-Calderon also urged all oil producers outside OPEC to join in on efforts to cooperate. "Certain countries can confirm that they have reached maximum production capacity, but they can always make extra efforts," the secretary general said, commenting on Norway’s refusal to increase production.

www.forbes.com Reuters, 01.15.03, 6:24 PM ET

CARACAS, Venezuela, Jan 15 (Reuters) - Venezuela's opposition on Wednesday extended for a 46th day a protest strike aimed at pressuring President Hugo Chavez to resign and call elections in the world's fifth largest oil exporter.

The opposition stoppage, which began on Dec. 2, has cutback Venezuela's vital petroleum production, hiked oil prices and inflamed the feud over ex-paratrooper Chavez's rule. Venezuela usually supplies about one sixth of U.S. oil imports.

"We will stay in the streets, defending the country," anti-Chavez business leader Jose Luis Betancourt told reporters.

Opposition leaders and rebel managers at state oil firm PDVSA have promised to maintain the shutdown until Chavez quits. But the combative president has dismissed calls for early elections and scoffed at charges from foes of corruption, economic mismanagement and authoritarian rule.

Chavez, who was elected in 1998 and survived a coup in April, has vowed to defeat the strike, which he dismisses as an attempt to topple him illegally through oil industry sabotage. Oil sales provide about half of government revenues.

www.newsday.com By Associated Press January 15, 2003, 6:11 PM EST

NEW YORK -- Crude oil futures rose sharply Wednesday after data showed a larger-than-expected weekly decline in American inventories.

Data released by the Energy Information Administration earlier Wednesday showed that U.S. crude oil stocks fell by 6.4 million barrels to 272.3 million barrels as refiners unexpectedly stepped up production by 1.1 percent to 92.3 percent of operating capacity.

The decline came despite a slight increase in imports. The data showed that imports rose by 200,000 barrels a day to 8.489 million barrels a day. Despite last week's increase, however, imports are about 1 million barrels a day lower than a month ago, an EIA analyst said.

Separately, the American Petroleum Institute reported that crude oil stocks fell by 3.264 million barrels to 272.236 million barrels last week, as imports tumbled by 676,000 barrels a day to 8.27 million barrels a day.

Despite the disparity in import figures, traders seized on the data as evidence that the seven-week strike in Venezuela continues to cut into U.S. oil inventories.

It was "the kind of report we thought it would take to keep prices on their upward path," IFR Pegasus energy analyst Tim Evans said of the EIA report.

On the New York Mercantile Exchange, February crude surged 84 cents to close at $33.21 a barrel, just shy of a two-year high of $33.65 a barrel hit last month.

Heating oil and gasoline futures rallied in tandem with crude despite bearish petroleum-product stock data.

February heating oil rose 1.70 cent to close at 90.86 cents a gallon, while February gasoline futures advanced 1.27 cent to close at 90.43 cents a gallon.

On London's International Petroleum Exchange, February Brent futures rose 61 cents to close at $31.22 a barrel.

Natural gas for February delivery surged 32.3 cents to settle at $5.430 per 1,000 cubic feet.

The rally in heating oil and gasoline futures was surprising given that the data indicated that refiners continued to build petroleum-product stocks.

The Energy Department report showed that gasoline stocks rose by 5.8 million barrels to 215.6 million barrels, while distillate stocks, which include heating oil and diesel fuel, grew by 2.6 million barrels to 132.3 million barrels.

The API report painted a somewhat mixed picture. It showed that while gasoline stocks swelled by 4.399 million barrels to 215.04 million barrels last week, distillate stocks posted a decline of 104,000 barrels to 134.28 million barrels.

Most analysts surveyed had forecast a moderate decline in both gasoline and distillate stocks.

"Even with the build of nearly six million barrels in gasoline, traders were a lot more interested in what was going on in the crude oil," said Peter Beutel, an analyst at Cameron Hanover in Connecticut. "The bottom line is that the major fundamental factors are still in effect, those being the strike in Venezuela and fear of a war with Iraq."

There was little indication Wednesday that either Iraq or Venezuela is going to go away as a bullish factor in the market.

The U.S. made a formal request Wednesday for limited help from the North Atlantic Treaty Organization in the event of a war with Iraq.

www.forbes.com Reuters, 01.15.03, 5:56 PM ET

WASHINGTON, Jan 15 (Reuters) - The Energy Department said late on Wednesday it renewed for another five years the contract it has with DynMcDermott Petroleum Operations Co. to run the U.S. government's Strategic Petroleum Reserve.

Under the contract, the company will be paid $120 million a year to maintain the readiness of the emergency oil stockpile's four storage facilities located in Louisiana and Texas.

The contract could also be extended for another five years. The stockpile has been the subject of much debate recently as some lawmakers have urged the Bush Administration to release oil from the reserve to offset lost supply due to the long strike in Venezuela.

The reserve, which currently holds 599 million barrels of crude, was created by Congress in the mid 1970s after the Arab oil embargo. The oil is held at the four sites in large underground salt caverns.

DynMcDermott was formed solely to operate the reserve. It is jointly owned by non-public DynCorp, McDermott InternationalInc. (nyse: MDR - news - people), Jacobs Engineering Group (nyse: MDR - news - people) and privately-held Internationl-Matex Tank Terminals.

afr.com Jan 16 09:38 AFP

Oil prices gushed higher overnight as US petroleum stocks shrank and fears mounted about the impact of a possible war in Iraq and the general strike in Venezuela.

"People are still taking in what's going on with Iraq and Venezuela," said Mike Fitzpatrick, market analyst at Fimat.

Prices had been supported by news that US commercial crude stocks had dropped last week, he said.

New York's reference light sweet crude February-dated futures surged US84¢ to $US33.21 a barrel.

In London, the price of benchmark Brent North Sea crude oil for February delivery leapt US61¢ to $US31.22 a barrel.

Commentators said concern over mounting tensions between the United States and Iraq, coupled with worries over Venezuelan supply disruptions, continued to drive prices.

"It's still the same issues - the Venezuelan strike and the impending threat of war against Iraq - which the market is really focusing on," said Prudential Bache oil broker Tony Machacek in London.

US President George Bush expressed mounting impatience with Baghdad on Tuesday, warning that "time is running out" for Iraqi leader Saddam Hussein to avert war by heeding a UN disarmament ultimatum. advertisement advertisement

GNI analyst Lawrence Eagles, also in London, said that although Mr Bush said little that was new, his comments had nonetheless served to "underscore the US message and the potential for unilateral action despite European pressure for diplomacy".

In a separate development, the United States earlier on Wednesday formally asked the North Atlantic Treaty Organisation for support in the event of a war against Iraq.

Supply disruptions, stemming from the ongoing general strike in Venezuela, have hit US stock levels in recent weeks, although not as badly as many had feared.

US commercial crude oil stocks - excluding the emergency reserve - fell last week as the Venezuelan strike pressured supplies.

The Energy Department said US commercial crude oil inventories dropped by 6.4 million barrels to 272.3 million barrels in the week to January 10 when compared with the previous week.

Crude oil imports rose 200,000 barrels a day from the previous week to an average 8.5 million barrels a day last week, it said.

Daily imports averaged 8.4 million barrels over the past four weeks, down about 400,000 barrels from the same period a year earlier.

"It appears that while crude oil imports from Venezuela continue to be much lower than normal, they have increased some over the last two weeks," the department said.