www.forbes.com Reuters, 01.27.03, 5:45 AM ET

In the LONDON story headlined "Oil edges higher ahead of Blix report" in the third paragraph please read ...1530 GMT (1030 local time)... and not ...1030 GMT (1030 local time)... (corrects time). A corrected repetition follows.

LONDON, Jan 27 (Reuters) - Strong oil prices held ground on Monday, awaiting a report from U.N. weapons inspectors for clues to the likelihood of war in Iraq.

U.S. light crude rose two cents to $33.30 a barrel, extending Friday's gains of more than $1 in New York. London Brent added 13 cents to $30.62 a barrel.

Chief U.N. weapons inspector Hans Blix at 1530 GMT (1030 local time) on Monday will deliver his first full report to the U.N. Security Council on Iraq's 12,000-page weapons declaration and Baghdad's cooperation with arms inspectors.

Blix said he would report that Baghdad has not submitted a full account and is also expected to say that it has hampered interviews with Iraqi scientists and blocked the use of U-2 surveillance flights over all parts of Iraq.

Blix told reporters that when questions arise about anthrax, the deadly VX nerve gas or Scud missiles, the Iraqis "simply say there is nothing left of this, and there is no evidence that we can view, there are no more documents."

U.S. President George W. Bush will make a State of Union address on Tuesday and is due to meet key ally Britain's Prime Minister Tony Blair later this week. Britain has sent thousands of troops to join a U.S. military build-up in the Gulf.

"Each of these stages will provide further clarity and we can expect a timetable to war to become a little clearer," said Sydney-based independent oil analyst Simon Games-Thomas.

Washington has made it clear it is ready to attack Iraq alone if needed.

U.S. secretary of State Colin Powell said at the weekend that time was running out for Baghdad to disarm voluntarily.

"We will not shrink from war if that is the only way to rid Iraq of its weapons of mass destruction," Powell said at the World Economic Forum (WEF) in Davos, Switzerland.

SAUDI SAYS NO SHORTAGE The world's biggest oil exporter Saudi Arabia, said at the weekend that it and fellow OPEC members were pumping sufficient volumes to prevent shortages on world markets.

Oil prices are near two-year highs on concerns that an attack on Iraq might coincide with the ongoing strike in Venezuela, which has strangled exports from the world's fifth-biggest exporter.

"There is no shortage in the market and there should be no reason for prices where they are today," Saudi Oil Minister Ali al-Naimi told a panel in Davos.

"We checked. We called. I checked with individual customers, refineries and others. I ask them one question: Do you feel you need more oil? And the answer is no," he said.

The Organisation of the Petroleum Exporting Countries agreed two weeks ago to raise output by 1.5 million barrels per day to counter some of the shortfall caused by a nationwide strike in Venezuela. Venezuela's President Hugo Chavez hinted at the weekend that he may be forced to take up arms if he were defeated by the opposition movement, which is calling for Chavez to step down.

Venezuelan crude output has recovered from lows in December when it was running at a trickle of about 150,000 bpd against more than three million bpd before the strike, which started on December 2.

Strikers said on Sunday that production was about 986,000 bpd, 30 percent of pre-strike levels, while Chavez claimed production had reached 1.32 million bpd.

www.bayarea.com Posted on Mon, Jan. 27, 2003 ALAN CLENDENNING Associated Press

PORTO ALEGRE, Brazil - Leonilda Zurita railed against the United States on Monday for backing Bolivia's efforts to curb illegal cultivation of the coca plant - the source of cocaine but also chewed by poor Bolivians to ease hunger.

Zurita, a Quecha Indian wearing an elaborately embroidered white skirt, handed out coca leaves to anyone who approached her. She was among thousands of anti-globalization activists at the third World Social Forum, a counterpoint to the World Economic Forum in Davos, Switzerland.

Though they came from around the world, the activists were united in their anger at what they call "neoliberalism," or the perceived American control over the world through free-market economics, liberal trade and the breakdown of national borders.

"We're living with an undeclared war to defend the coca leaf, which for Bolivian peasants is a medicine that helps us put up with hunger," Zurita said. "At the root of this, I say, our struggle is with the United States."

About 30,000 acres of coca are cultivated legally in Bolivia, but there are many illegal fields the government is destroying with the financial help of the United States. Growers want more legal harvesting.

The activists blamed neoliberalism for problems ranging from sweatshops to environmental devastation and for government policies that favor foreign investors.

About 100,000 people attended the six-day forum, which closes Tuesday. The last major protest - a march against a possible U.S.-led war in Iraq and a proposed Free Trade Area of the Americas, or FTAA - was to take place Monday evening.

For many here, the United States is a bully that uses economic force to compel weaker countries to comply with its foreign policy and economic goals.

Activists from Turkey, for example, believe the United States has promised billions of dollars in debt relief to help the country's troubled economy in return for assurances that American forces can use Turkish soil to launch an invasion of Iraq.

"We directly oppose any kind of economic values being bargained that would justify the Turkish participation" in the war, said Erinc Yeldan, an economics professor with Bilkent University in Ankara.

Before hundreds of cheering activists, actor Danny Glover called for the elimination of the International Money Fund, the World Bank and the World Trade Organization, blaming them for many Third World ills.

"We have to fight and abolish those financial institutions which place us at the place where we are now, in this very fragile situation," Glover said.

Anarchist and linguist Noam Chomsky said the United States exerts its influence over other countries with more subtlety than it did decades ago.

Neoliberalism "is a new way of controlling the public that in the past was done with U.S.-backed military coups and dictatorships," he said.

news.ft.com By Ivar Simensen in London Published: January 27 2003 10:49 | Last Updated: January 27 2003 16:36

Investors continued to move out of equities and into commodities on Monday, pushing gold prices to fresh highs along the way, as the fear of war in Iraq continued to dominate investor sentiment.

Spot gold jumped to $372.5 per troy ounce in London, its highest level since December 1996. It was at $370.6 as US trading got under way.

Investors moved into commodities after US and UK officials at the weekend made it clear that they were ready to go to war with Iraq alone if an agreement with the United Nations security council could not be reached.

Colin Powell, the US secretary of state, on Sunday told global business and government leaders at the World Economic Forum in Davos: "The US is in no rush to go to war. We seek Iraq's peaceful disarmament. But we will not shrink from war if that is the only way to rid Iraq of its weapons of mass destruction." See more on Mr Powell's warning to Iraq

Other metal prices were strong, with platinum at $643 per troy ounce, slightly off last week's 16-year high of $652.

Prices were steady as investors watched Hans Blix, the chief UN weapons inspector, deliver a key report to the United Nations security council on Monday.

On the International Petroleum Exchange in London, Brent crude gave up early gains and the benchmark March contract was 19 cents lower at $30.30 per barrel. Nymex-traded crude was down 31 cents at $32.97 in New York.

A war in Iraq could potentially curb oil supplies from the oil-rich region, which would send oil prices surging from already firm levels. Inventory levels in the US are at their lowest for several years, following the absence of imports from Venezuela, where a general strike has dramatically cut oil exports since the beginning of December.

santafenewmexican.com By ALAN CLENDENNING | Associated Press 01/27/2003

From left, French activist Jose Bove and Bernard Cassen meet Venezuelan president Hugo Chavez for a private meeting on Sunday, Jan. 26, 2003. - AP | Giuseppe Bizzarri

PORTO ALEGRE, Brazil—Venezuelan President Hugo Chavez, facing protests at home, got an enthusiastic welcome after arriving at the World Social Forum to meet with sympathizers among 100,000 activists venting against American-style capitalism.

Chavez met with forum organizers and addressed activists Sunday in this far southern Brazilian port city, harshly criticizing opponents in Venezuela staging a 56-day strike.

He said they would fail to oust him from power, and praised activists for their opposition to neoliberalism - their term for a mix of unfettered free-market economics, liberal trade and the breakdown of national borders

"You here at the forum and we in Venezuela are trying to come up with an alternative to neoliberalism that is destroying the world," Chavez said in a two-hour speech attended by more than 2,000 cheering activists. "If we don't put an end to neoliberalism, neoliberalism will put an end to us."

Before he spoke at Port Alegre's state legislature, hundreds showed up outside and handed out free copies of a book in English and Spanish entitled, "The Fascist Coup Against Venezuela," a compilation of Chavez speeches over the last two months.

Dressed in her white habit and waving a small Venezuelan flag, Franciscan nun Maria Vandege Santa said Chavez is fighting injustice and poverty in Venezuela.

"I am here to protest the efforts to topple a president who only wants to help the poor," said Santa, who lives in Brazil's poverty-stricken northeast.

Chavez said would soon propose a tax on all financial transactions in Venezuela, saying it would be "a kind of Tobin tax." Tobin taxes, named after Yale University economist and Nobel-laureate James Tobin, are designed to tame currency market volatility.

Chavez did not provide more details on the new tax, nor when he would seek to have it put into place. He also said Venezuela's dollar-based reserves dropped a total of US$3 billion in December and January.

Opponents gathering signatures to demand a constitutional amendment that could lead to early elections are welcome to do so, Chavez said, but claimed an earlier effort was tainted by fraud.

Any new effort "has to be a valid collection of signatures," Chavez said.

Although Chavez wasn't formally invited to the World Social Forum, a counter-conference to the World Economic Forum being held in Davos, Switzerland, he was attending some events.

Activists at the six-day social forum are participating in 1,700 sessions and workshops on topics ranging from corporate misdeeds to Third World debt.

Chavez fits right in, many say, because he advocates political, social and economic revolution to solve South America's ills.

He came to the forum because he "wants to further address in Porto Alegre the same issues of poverty, misery and corruption that he is trying to address in Venezuela," said Jo Moraes, vice president of the Communist Party of Brazil.

The strike in Venezuela has paralyzed the country, crimped oil production for the world's fifth-largest oil exporter and caused severe food and fuel shortages. Chavez told reporters, however, that oil production that was once as low as 200,000 barrels per day is rising and is now at 1.32 million barrels a day.

On Sunday, at least 100,000 Venezuelans were parked on a Caracas highway in what they said would be their longest protest yet against Chavez.

But Chilean Senator Gladys Marin, a Communist, said Chavez is helping to fight what could become fascism in South America.

"If this coup wins, you will suffer a long dictatorship and it will be cruel," she told 1,000 activists gathered at a forum workshop.

Also Sunday, an unidentified woman threw a strawberry cake into the face of Jose Genoino, the head of President Luiz Inacio Lula da Silva's Workers Party, yelling "Lula does not represent us in Davos."

Some activists criticized Silva, who is popularly known as Lula, for going to the economic forum in Switzerland after attending the social forum.

The woman left a statement saying she belonged to a group called "Bakers Without Borders." Genoino called the incident an "act of anarchists," according to Brazil's GloboNews television network. The woman fled, and no efforts were made to detain or arrest her.

santafenewmexican.com

By JOSEPH B. FRAZIER | Associated Press 01/27/2003

Venezuelan President Hugo Chavez gestures during a press conference in Porto Alegre, Brazil on Sunday Jan. 26, 2003. - AP |

CARACAS, Venezuela—President Hugo Chavez said he would put in place price and currency controls as Venezuela's economy heads for a tailspin stemming from an opposition strike, which was entering its ninth week Monday.

"So that these (currency) controls do not hurt the poor, we will institute price controls," Chavez said Sunday in Porto Alegre, Brazil, at the World Social Forum. He did not give details of the controls.

Hundreds of thousands of his foes occupied a central Caracas highway for the entire weekend to protest a Supreme Court decision suspending a Feb. 2 referendum on Chavez's rule.

After extending the protest well beyond the 24 hours planned, protesters finally rolled up their national flags - and, in many cases, their tents - and let traffic flow again.

Opposition leaders said instead of the referendum they would collect signatures Feb. 2 petitioning for Chavez to quit, for his term to be cut and for pro-Chavez lawmakers to be replaced.

A coalition of business, labor and political groups called the strike Dec. 2 to pressure Chavez into accepting the referendum.

Although the referendum wouldn't have been binding, opponents had hoped a negative outcome would have embarrassed Chavez into quitting.

Cutting his term through a constitutional amendment would pave the way for early elections. The amendment would involve cutting Chavez's six-year term, currently due to run until 2007, to four.

Amending the constitution requires a popular referendum. Citizens can demand such a vote by collecting signatures from 15 percent of Venezuela's 12 million registered voters.

Chavez suspended foreign currency dealings for five business days last Wednesday to halt the rush of nervous Venezuelans trading in their bolivars for dollars. The currency has lost 25 percent of its value this year alone.

On Sunday, he said he will soon propose a tax on all financial transactions in Venezuela, saying it would be "a kind of Tobin tax." Tobin taxes, named after Yale University economist and Nobel-laureate James Tobin, are designed to tame currency market volatility.

Chavez did not provide more details, but said Venezuela's dollar-based reserves dropped US$3 billion in December and January as a national strike dried up oil exports.

Dollars are needed to buy food - about half of which is imported - medicines and other essentials, some of which already are in short supply.

Venezuela must import gasoline, which is so hard to find that lines at the few open stations sometimes stretch for a mile (1.6 kilometers) or more.

Oil provides 80 percent of the government's foreign exchange and makes up a third of gross domestic product. Before the strike, Venezuela was the world's fifth-largest supplier.

Chavez said Sunday that oil production has risen to 1.32 million barrels a day. But dissident oil executives put the figure at about 957,000 barrels. Pre-strike production was about 3.2 million barrels, and fell as low as 150,000 barrels early in the strike.

Many small businesses that joined the strike at its outset Dec. 2 have since returned to work but thousands of others have refused to open up, despite the damage being wreaked on the economy.

Exchange controls will help protect the bolivar and the government's depleting foreign reserves. But they will hurt many businesses as dollars are needed to buy food, about half of which is imported, medicines and other essentials, some of which already are scarce.

The Santander Central Hispano investment bank has warned that Venezuela's economy could contract as much as 40 percent in the first quarter of 2003. It shrank by an estimated 8 percent in 2002. Unemployment is 17 percent and inflation, fueled by a 46 percent devaluation of the bolivar last year, is 30 percent.