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By ALEXANDRA OLSON The Associated Press   Venezuela's government rejected an opposition proposal to cut President Hugo Chavez's term and instead suggested a referendum on his rule later this year as a way out of the country's political crisis, a negotiator said Tuesday.

Ronald Blanco la Cruz, a government negotiator at talks mediated by the Organization of American States, said that under the government's proposal, opponents can start collecting signatures for a so-called recall referendum in August, halfway into Chavez's six-year term.

That was sure to infuriate the opposition, which says it already has collected more than 4 million signatures for a constitutional amendment ending Chavez's term this year and calling new elections.

Chavez repeatedly has pledged that a recall vote can be held in August - not just that it can start to be organized, as indicated by Blanco la Cruz.

Blanco la Cruz, governor of Tachira state, also said the government has rejected the opposition's proposals to amend the constitution.

"Otherwise, people would start collecting signatures as soon as a president is elected," he told the government's Venezolana de Television.

Venezuela's constitution requires signatures from 20 percent of 11 million registered voters - roughly 2.2 million people - to demand a recall vote.

OAS Secretary General Cesar Gaviria has been mediating talks since November to try to end Venezuela's political deadlock.

He received a boost when former President Jimmy Carter laid out two options for Venezuela: a recall vote in August, or a constitutional amendment shortening Chavez's term to four years with an early election.

Chavez is a former army paratrooper who led a failed coup attempt 11 years ago Tuesday. Jailed for two years, he was elected president in 1998 on an anti-poverty platform and re-elected in 2000. His current term ends in January 2007.

Citing economic and political turmoil, Venezuela's opposition launched a general strike Dec. 2 to seek his ouster.

The strike crumbled this week as workers in all industries except oil returned to their jobs. The government, meanwhile, raised oil production to 1.2 million barrels a day, up from 1.1 million barrels over the weekend, according to dissident staff at the state oil company.

Venezuela produced 3.2 million barrels a day before the strike. It is a major supplier of crude to the United States and the world's fifth-largest petroleum exporter.

Venezuela was expected to add 200,000 more barrels per day in the coming weeks, staff at Petroleos de Venezuela S.A. said.

Fear of bankruptcy and shortages of gasoline and other essentials prompted leaders to end the strike. But they proclaimed victory, saying the strike had drawn pressure from the international community on Chavez to resolve the stalemate.

Julio Brazon, president of the Consecomercio business chamber, which represents about 450,000 businesses, said the strike was a "resounding success" because "an electoral solution to the crisis is in march."

Some analysts disagreed.

The strike reflected "the disorganization of the opposition," said Riordan Roett, director of Western Hemisphere studies at Johns Hopkins University. "It was anti-Chavez but never pro-anything. What were they going to replace Chavez with?"

The United States and five other countries have joined the OAS in mediating talks and seeking early elections.

Chavez claims his "revolutionary" government would crush the opposition at the ballot box. He said Sunday that he will prosecute strike leaders for sabotaging the economy.

www.bloomberg.com By Darren Boey

Sydney, Feb. 6 (Bloomberg) -- Australian stocks fell, paced by gold miners such as Newcrest Mining Ltd., after the price of the metal dropped on concern the U.S. failed to provide evidence to the United Nations to justify an attack on Iraq.

The S&P/ASX 200 dropped 15.50, or 0.5 percent, to 2903.20 as of 10:23 a.m. in Sydney. Five stocks declined for each that advanced. The broader All Ordinaries Index fell 0.5 percent to 2883.

Gold for April delivery fell 0.7 percent to $377.20 an ounce on the Comex division of the New York Mercantile Exchange.

Newcrest slid 19 cents, or 2.9 percent, to A$6.33. Croesus Mining NL slumped 4 cents, or 4.4 percent, to 86 cents. Lihir Gold Ltd. fell 5 cents, or 3.2 percent, to A$1.52.

New Zealand's stock market is closed for the Waitangi Day public holiday.

The following stocks are, or were, active. The stock symbols are in parentheses after the company names.

Australian stocks:

BHP Billiton (BHP AU ), which makes a third of its earnings from oil, gained 6 cents, or 0.7 percent, to A$9.15. Crude oil for March delivery gained 1 percent to $33.93 on the New York Mercantile Exchange, the highest closing price for a most- active contract since Nov. 29, 2000.

David Jones Ltd. (DJS AU ) added a cent, or 0.9 percent, to A$1.08. The department store owner said its second- quarter sales rose 3.4 percent to A$538.8 million ($318 million). It kept its full-year net income forecast of a 15 percent to 20 percent gain unchanged, the company said in a statement to the Australian Stock Exchange.

Goodman Fielder Ltd. (GMF AU ) climbed 6 cents, or 3.5 percent, to A$1.79. Goodman, the target of a hostile takeover offer from rival foodmaker Burns Philp & Co. (BPC AU ), rose as 3.8 percent of its shares changed hands. Credit Suisse First Boston, which is advising Burns Philp, bought 41 million of the 46 million Goodman Fielder shares traded so far today.

Macquarie Infrastructure Group (MIG AU ): The toll- road investor said average daily revenue from its M1 highway in Sydney, Australia's most populous city, rose 11 percent in January from a year ago.

www.brudirect.com

Doha - Brunei Industry and Primary Resources Minister Pehin Dato Awang Haji Abdul Rahman is in Doha, Qatar attending the 3rd Ministerial Meeting of the Gas Importing Countries Forum.

The unofficial forum involves 12 main exporters of gas in the world namely Brunei, Iran, Algeria, Indonesia, Malaysia, Nigeria, Bolivia, Venezuela, Oman, Qatar, Russia and Libya.

At the meeting Algeria, Iran and Qatar were to deliver a briefing on a new framework on the export of gas to the European Union (EU), a contract on the implementation of gas projects, technology development and the expenditure on utilisation of gas.

The meeting also exchanged the latest information on gas and international energy development, demands and global development in the natural gas industry as well as on the latest technologies.

Brudirect.com

www.morningstar.ca 4 Feb 03(12:44 PM) |  By Duncan Shiels

LONDON (Reuters) - Oil prices rose on Tuesday as differences of opinion between France and Britain over Iraq unnerved traders already edgy ahead of a U.S. presentation to the U.N. that could press the case for war against Baghdad. Benchmark Brent crude by 1730 GMT was up 65 cents at $30.90 a barrel while New York light crude was 62 cents higher at $33.86.

British Prime Minister Tony Blair, Washington's closest ally in the Iraq crisis, on Tuesday failed to coax French President Jacques Chirac into softening his opposition to swift military action against Iraq.

Both leaders said differences remained over how to ensure Iraq does not possess weapons of mass destruction, but they agreed disarmament should take place through the U.N. Security Council.

"As far as Iraq is concerned, we have different approaches but first and foremost we have two convictions which are fundamental and are shared," Chirac told a news conference after talks with Blair.

"The first is that we have to disarm Iraq, and the second conviction that we share is that this has to be undertaken within the Security Council of the United Nations. Regarding that, we are entirely in agreement," he said.

But Chirac went on to say that war was the worst possible solution.

"(The price rise) is all from the Blair-Chirac talks," said analyst Mark Head of brokers Fimat Banque in London. "The market wants to make something bullish out of it, that's what it boils down to."

Secretary of State Colin Powell has said he would provide "sober and compelling proof" that Baghdad is hiding banned weapons from U.N. arms inspectors when he addresses a session of the U.N. Security Council beginning at 1530 GMT (1030 EST) on Wednesday.

The U.S. has vowed to disarm Iraq, by force if necessary, action which traders say could disrupt supplies not only from Iraq but also from other producers in the oil-rich Middle East.

OPEC WORRIED ABOUT OIL GLUT

Nervousness over Iraq outweighed the effect of rising crude output from oil exporter Venezuela as the protracted strike there starts to unravel.

OPEC officials are now starting to fret over a possible oil surplus in the second quarter.

Cartel President Abdullah al-Attiyah said on Tuesday a recovery in exports from strike-bound Venezuela meant the cartel might need to cut supplies in the second quarter, despite the threat of war in Iraq.

"Given the scenario as it is today, we could have a three-million barrel-per-day glut," Attiyah said, adding that demand usually declines by two million bpd in the second quarter on the 77 million bpd world market.

OPEC ministers meet in Vienna on March 11.

Iran's Oil Minister Bijan Zanganeh said OPEC faced two choices at its March meeting, to maintain its official production ceiling or cut output.

Venezuelan President Hugo Chavez said at the weekend Venezuela was pumping close to 1.8 million bpd, up from a low of 150,000 bpd after the strike began in December and more than half of the 3.1 million bpd pumped in November.

Strikers said on Tuesday that crude output was running at 1.2 million bpd.

Data from shipping agents indicated Venezuela's oil exports rose to 890,000 bpd in the week to February 1 from 550,000 bpd the previous week.

www.wavy.com

Caracas, Venezuela-AP -- Venezuela's government is proposing a way out of the crisis that has gripped the nation for two months. It has rejected an opposition plan to cut President Hugo Chavez's (OO'-goh CHAH'-vezihz) term short. But it is proposing a referendum on his role later this year.

The opposition called a general strike in early December as a way of forcing Chavez out of office. The strike largely broke down this week.

The government proposal says opponents can start collecting signatures for a recall referendum in August -- which would be halfway through Chavez's term.

Chavez has repeatedly said a recall vote could actually be held in August.

The opposition says it has already collected more than four (m) million signatures for a constitutional amendment ending Chavez's term this year.