www.vheadline.com Posted: Sunday, January 26, 2003 - 3:19:12 AM By: Robert Rudnicki

With the opposition work stoppage about to enter its eighth week, Federation of Chambers of Commerce & Industry (Fedecamaras) president Carlos Fernandez said the opposition would rethink its strategy after February 2, the date it had hoped to hold a consultative referendum on President Hugo Chavez Frias' rule. The referendum was suspended last week following a Supreme Tribunal of Justice (TSJ) ruling that stated that all National Electoral College (CNE) decisions were to be declared void, because of concerns over CNE board member, Leopoldo Pizani's eligibility. 

The opposition will now hold a symbolic referendum on February 2, and the next day its new strategy will commence. This new plan could include the suspension of the national work stoppage, "although the fight will continue ... we are negotiating and we will see if the conditions are right to end the strike."

Fernandez also said that a nationwide information campaign would be organized to let workers know how "how we can help them." the Fedecamaras chief also promised to assist all petroleum workers that have supported the stoppage, including those that have since been fired. 

Meanwhile, Confederation of Trade Unions president Carlos Ortega said further meetings would be necessary to bring the crisis to an end, put that the population of Venezuela, particularly the military, had made in very clear that they want both sides to remain within the Constitution.

www.vheadline.com Posted: Sunday, January 26, 2003 - 1:38:00 AM By: Robert Rudnicki

Foreign Minister (MRE) Roy Chaderton Matos has told reporters that the government is willing to support any proposals to end the current political deadlock, as long as they are within the Venezuelan Constitution.

The MRE Minister also urged both sides of the political divide to tone down their rhetoric and called for an end to the rising spiral of violence in the country ... "we need guarantees, because we have a very violent and irrational opposition."

Chaderton Matos also renewed President Hugo Chavez Frias' call for the eventual expansion of the "Friends of Venezuela" group from the current six members ... Brazil, Chile, Mexico, Portugal, Spain and the United States ... to include other nations like Algeria, Cuba, China, France and Russia.

Last week, Cuban leader Fidel Castro warned President Chavez Frias that the current group is made upmainly of  enemies rather than friends ... alleging that most of the countries involved had helped out in the failed April 11 coup d'etat, which briefly removed the President form office. Castro also said that, if President Chavez Frias called for his involvement, he would be willing to consider assisting the group.

www.bayarea.com Posted on Sun, Jan. 26, 2003 By Christopher Toothaker ASSOCIATED PRESS

CARACAS, Venezuela - Opponents of President Hugo Chavez launched a 24-hour street demonstration Saturday to protest a court ruling that postponed a referendum on Chavez's rule.

A 21/2-mile stretch of central Caracas highway was set aside for the event, which organizers warned may last longer than one day.

"Prepare yourself for the longest protest in history!" screamed TV commercials and newspaper ads in the opposition-run media. They advised protesters to bring drinking water, sun hats, folding chairs and portable TVs to while away the hours under the tropical sun.

The demonstration followed a Supreme Court decision Wednesday to indefinitely postpone a nonbinding plebiscite, dashing opposition's hopes for a means of removing Chavez from office. Opposition leaders were convinced Chavez would be so embarrassed by the outcome, he would quit.

Negotiations mediated by Cesar Gaviria, secretary general of the Organization of American States, continued, aimed at ending the 55-day-old strike and bitter political stalemate.

But the opposition says it isn't going to wait for talks to produce results.

"We can't wait for the rainstorm to hit without having an umbrella," said Haydee Deutsch, of the Democratic Coordinator opposition movement.

Opponents are now considering a proposal by former President Carter, which would amend Venezuela's constitution to shorten presidential and legislative terms and mandate early elections.

"It's an option we think is viable," said labor leader Alfredo Ramos.

The proposal calls for the opposition to end the strike and for the government, which has a congressional majority, to move quickly on changing the constitution. Amending the constitution requires congressional approval and a popular referendum.

A second proposal by Carter, who won the Nobel Peace Prize last year, calls for Venezuelans to prepare for a binding recall referendum on the president's rule in August.

The so-called "Group of Friends of Venezuela," six countries that have pledged to help Gaviria broker an end to the crisis, met for the first time in Washington on Friday.

Secretary of State Colin Powell, who attended the meeting, urged Venezuelans to adopt Carter's ideas.

"The Carter proposals represent the best path available to the Venezuelans. They provide the badly needed basis on which both sides can bridge their differences on the immediate issues," Powell said, in a text released by the State Department.

While the "Friends" initiative began to take shape, oil production in Venezuela, the world's fifth largest exporter, was creeping up.

Increased output could be a sign Chavez is defeating the work stoppage intended to force his ouster. But the former paratroop commander still struggles with the strike's effect on a recession-hit economy.

Oil production stood at about 3.2 million barrels per day before the strike was called Dec. 2. -- and slipped as low as 150,000 barrels per day later that month.

On Friday, dissident executives at state-run monopoly Petroleos de Venezuela S.A., or PDVSA, said output had crept to 855,000 barrels per day, up from 812,000 barrels on Thursday.

But production gains could be capped if exports, averaging around 450,000 barrels a day, don't pick up quickly. If oil isn't shipped, inventories pile up and no space remains for fresh production.

Many tanker pilots returned to their jobs this week, but foreign shippers remained reluctant to use Venezuelan ports because regular docking and support personnel have not abandoned the strike.

Oil exports account for roughly half of government income. Chavez's government has acknowledged losing over $4 billion since the strike started.

Chavez could be "winning the petroleum war," as he claimed on Thursday, but the economic outlook for 2003 is dismal.

The Santander Central Hispano investment bank warned that Venezuela's economy could contract as much as 40 percent in the first quarter of 2003 if the crisis isn't resolved soon. The economy shrank by an estimated 8 percent in 2002.

www.chicagotribune.com By Melita Marie Garza Tribune staff reporter Published January 26, 2003

The oil price run-up, partly triggered by the threat of war with Iraq, has cut into milk money, and in some cases, the rest of the grocery bill too.

Just this month Oberweis Dairy, based in North Aurora, increased its home delivery charge by 10 cents to $2.30 to cover increased diesel fuel costs. What's more, the 76-year-old dairy, which has 40,000 home delivery customers, also is considering retrofitting trucks to run on gasoline to further cut fuel costs.

"We have been trying to ride out the price swings for the past three years, but this is completely out of control," said Robert Renaut, Oberweis' president. "We haven't passed any of the costs on. This increase just gets us back to even."

Diesel fuel, which sells for an average of $1.66 a gallon in the Chicago area, generally is more expensive than gasoline and supplies are more limited. As a result, Oberweis has looked into converting 54 home delivery trucks and about a dozen larger vehicles used to haul milk to grocery stores to operate on gasoline. "There is a time lag involved in ordering the required parts and having the trucks converted," Renaut said. "The other issue is that if supplies are disrupted, neither gasoline nor diesel might be available."

A prolonged war with Iraq likely would cause oil prices to soar further, contributing to a ripple effect of price increases as trucking companies and retailers try to pass off higher energy costs to consumers. The higher prices would be reflected in the bulk of the nation's goods, which primarily are delivered by truck.

The situation could be more serious than the one truckers and motorists confronted during the Persian Gulf war in 1991, when U.S. oil refiners were awash in crude inventory. Since 1999, oil companies have limited the amount of refined fuel kept in storage. As a result of an 8-week strike in Venezuela, one of the top five oil exporters to the U.S., oil companies have been tapping stored inventories to keep products flowing.

Such use has reduced the U.S. inventory close to a critical 270-million barrel level that the federal government says could lead to supply disruptions.

The truckers only have to look back to 2000 to get an idea of what could happen. A price spike in diesel fuel essentially stalled truckers in parts of New England.

"Diesel fuel cost between $2.50 and $2.60 a gallon, and trucks would not even go into Maine because there was not enough freight to pick up on the return trip to offset the cost," said Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association in Grain Valley, Mo.

Any disruption in trucking would have an almost immediate impact on consumers and workers.

Businesses ranging from groceries to manufacturers have widely adopted just-in-time inventory practices to reduce costly warehousing and to avoid having money tied up in parts or goods.

"There is more dependence on just-in-time deliveries," said Mark Whitenton, vice president for resources and environmental policy at the National Association of Manufacturers. "Even a couple of days disruption could cause factories to close."

Spencer paints a dire scenario for small or independent truckers, who generally operate under contract and, as a result, cannot impose surcharges to cover fuel price hikes.

"Most small-business truckers don't have an operating cash reserve that would allow them to withstand a long run of increased prices," Spencer said. "We would quickly see repossessions of trucks."

Consider what happened to long-haul trucker Lee Klass in 1990 when crude oil prices nearly doubled to $41 a barrel after Iraq invaded Kuwait.

40-cent price jump

"The price of diesel fuel jumped 40 cents a gallon," Klass, now 55, recounted. Rather than pay the price at the pump, he parked his truck. "I decided not to take any loads for a couple of days just to see how things shook out. It reaches a point that unless rates are doubled it doesn't make sense to haul any freight."

The quick success of the U.S. and its allies in the 1991 conflict eased fears of oil supply shortages, and prices plunged as rapidly as they had risen, easing to $21 a barrel by February 1991.

"The war could have a positive effect on the economy," said Sung Won Sohn, chief economist at Wells Fargo Bank. "We have a decisive war in our favor so the price of oil drops dramatically to low teens. That would raise consumer and business confidence significantly. The price of oil could drop by more than half, which would amount to a huge tax cut for us, bigger than anything Bush proposes."

Still, these days, uncertainty, rather than oil, seems more abundant.

"The world oil market is being strained right now and people are trying to guess what's going to happen when we invade Iraq," said Mark Baxter, director of the Maguire Energy Institute at Southern Methodist University in Dallas.

"I believe the market already has counted in the effects of Iraq. But they aren't counting on Iraq, Venezuela, and the effects of any refinery, pipeline or other mishaps on top of that," Baxter said.

Baxter noted that two weeks ago a couple of oil platforms in the North Sea were shut down due to a flaring problem, taking more than 100,000 barrels a day off the market.

Customarily, an event like this would add a couple of cents to the price of a barrel of oil. But in the context of war, these incidents could ratchet up prices more significantly.

Terrorist attacks?

Other unknowns about potential supply disruptions loom, including the prospect of terrorist attacks on oil tankers, something that had not been widely contemplated in 1990.

"What will Saddam do with those oil wells and those oil fields?" Baxter asked. "Is this an opportunity for overt actions by terrorists? Disrupting the shipping lanes for these oil tankers would be a major disruption to the oil supply."

Bill O'Grady, vice president, futures research, at A.G. Edwards in St. Louis, asked: "Why were the oil companies holding such huge inventories prior to the Persian Gulf war? You saw a similar buildup prior to the Iran-Iraq war. And why aren't they building them now?"

"It could be that they don't think there is going to be a war. Or, yes, there will be a war, but it will be very short and they don't want to be saddled with a lot of product to sell at low prices. Or it could be that they are relying on the U.S. Strategic Petroleum Reserve, and counting on the government to hold the extra supply for them."

Last May Peapod Inc., the Skokie-based Web grocer, raised its delivery charge in the Chicago area from $2.95 for an order of $100 to more to $4.95, partly to offset rising fuel costs.

In December it went a step further. It spent $15,000 to install its own gasoline storage tanks at its Lake Zurich distribution center. Drivers for its fleet of 70 trucks cover a combined 6,000 miles daily and had been driving off their routes to find gasoline stations that would accept the company's credit cards.

Scott DeGraeve, vice president and general manager for Peapod's Chicago region, explained: "The rising fuel prices spurred us to see what we could do to offset these costs. It saves us a few pennies, but it also saves us labor and time."

Copyright © 2003, Chica

www.newsday.com By Letta Tayler LATIN AMERICA CORRESPONDENT January 26, 2003

Caracas - Belen Coronado, a retired court employee, doesn't permit political discussion in the Caracas apartment she shares with her daughter and son-in-law. "If we talk politics, we argue," she explained.

Coronado, 69, is a fan of populist President Hugo Chávez. Her daughter, Natalia Coronado, and son-in-law, Tony Ponce, a food distributor, back an 8-week-old national strike that aims to topple the leftist leader.

Briefly lifting the ban on political discussion for a visitor one recent afternoon, the usually soft-spoken relatives remained polite for about a minute before the barbs began to fly across their comfortable living room.

"We've had it with Chávez, We want him out now," said Natalia, 29, a homemaker, her voice prickling with anger.

"Then you're willing to break with the Constitution," her mother shot back, noting that the law will permit Venezuelans to call a binding referendum on truncating Chávez's six-year term only after its midpoint in August.

"Chávez doesn't respect the Constitution either, and he's ruining the economy," counter-attacked Ponce, 32.

The polarization within Venezuela over Chávez's presidency is widely assumed to pit rich against poor. While in many cases that is the case, the fault line also cuts through social classes, institutions and professions, further complicating efforts to unify a nation teetering on chaos.

"The tensions generated within families who are divided over the president are profound and unprecedented," said Luís Vicente León, who heads the Caracas-based Datanalisis polling company.

"It's turning brother against sister and cousin against cousin," said Elizabeth de Barnola, 54, a Caracas leather merchant whose family is split over Chávez.

In a half-century of democracy, members of Venezuela's tightly knit families often have held divergent political views. In the past, however, "these distinctions were 'light,' generating the kind of discussion one hears among fans of different baseball teams," León said.

In contrast, political experts say, the flamboyant Chávez - a former paratrooper who led a failed coup in 1992 and was elected by huge margins six years later - incites extreme hatred or adulation with his combative rhetoric and autocratic style, particularly as the country slides further into inflation, unemployment and violence.

With Chávez having largely failed in his campaign pledges to distribute the nation's vast oil wealth among the poor, numerous polls show him popular among only 30 percent of Venezuelans, far fewer than the 80 percent who live below the poverty line.

At the same time, one in five middle-class or wealthy Venezuelans supports the president, León said.

They include Belen Coronado, a diminutive, unassuming woman who lost 15 years' worth of her modest pension benefits - almost half the total - under austerity measures instituted by one of Chávez's predecessors.

Although she now lives in a comfortable apartment appointed with oil paintings and a crystal chandelier, Coronado remembers waiting in lines for food handouts during acute economic crises under previous regimes.

"Finally, for the first time in more than 40 years, we have a president who wants to help the poor instead of only helping the elite," she said.

"There are more poor children walking the streets now than there ever were before Chávez," rebutted her daughter, momentarily losing her own quiet poise.

"You can't expect a president to turn the country around in a few years," Coronado countered, adding that the opposition is "committing a crime against young children" by closing schools as part of strike actions.

For the indefinite future, Coronado has banned her daughter and son-in-law from watching news on the television in the living room, because all but one of Venezuela's highly politicized networks broadcast almost nothing but criticism of the government and praise for the strike.

If Natalia Coronado wants to join the cacerolazos, the nightly protests in which Chávez opponents march through the streets banging on pots and pans, her mother has decreed that she may do so only from the apartment's fifth-floor window. Should Natalia participate in a march, her mother flatly refuses to baby-sit.

Natalia circumvents that ban by leaving her 2-year-old daughter with her husband, who's been home every day since Dec. 2 because he has joined the anti-Chávez strike.

"I resent it that I can't express myself politically in my own home," Natalia said.

"What you're expressing is a hatred that will eat you up inside," her mother rejoined.

Since the severe rupture over Chávez began a few years ago, "everyone has begun to express their differences," said Caracas sociologist Mercedes Pulido. "The problem is, no one accepts them. What we need is a leader who can heal the wounds."

If the next president is elected peacefully, families will mend their internal rifts more easily, Pulido predicted. "But if it ends by insurrections or violence, it will be more difficult."

Asked if they would forgive and forget their political differences if Chávez is unseated through widespread violence, Belen and Natalia Coronado shifted in their seats and looked at each other expectantly across their marble coffee table.

"I hope so," the daughter said.

"I don't think so," the mother answered, gently but firmly.