www.chron.com Feb. 7, 2003, 10:48PM Copyright 2003 Houston Chronicle News Services

NEW YORK -- World crude oil prices hit fresh more-than-two-year highs Friday as concerns of a winter fuel supply crunch in the United States combined with mounting rhetoric against oil supplier Iraq and renewed threats against U.S. economic targets.

"Once you get into a panic buying situation, you really never know when it's going to stop," said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago.

Traders are concerned that an attack on Iraq, the world's No. 8 oil exporter, could coincide with a crippling strike in Venezuela, to leave supplies dangerously thin during the high-demand winter season in the Northern Hemisphere.

The U.S. Energy Information Administration said Friday that low supplies and troubles in Iraq and Venezuela mean the average price for U.S. crude oil is expected to stay above $30 a barrel for the rest of this year.

That projection is bad news for U.S. heating oil and gasoline consumers.

In addition, it could hinder the recovery of an economy struggling to rebound from recession.

In Texas, the statewide average for a gallon of regular self-serve fuel is $1.49 -- up 6 cents a gallon in only a week, according to the Weekend Gas Watch, compiled by AAA Texas. San Antonio has the least expensive fuel at nearly $1.45 a gallon -- up more than 6 cents in a week, and that's 45 cents more than last year's average of $1 a gallon. Houston and Dallas tied for the most expensive fuel, averaging nearly $1.50 a gallon. Both cities saw increases of nearly 6 cents a gallon.

"The recent increases appear to be the result of panic pricing by retailers on the anticipation of war with Iraq," said Rose Rougeau, spokeswoman for AAA Texas. "In some areas, the price of gas jumped 5 to 10 cents higher within the last couple of days. This move is premature, considering gasoline supplies in the United States are plentiful."

Nationwide this week, the average price of regular unleaded gasoline was $1.53 per gallon, up 11 cents since the year began and 43 cents higher than a year ago.

On Friday at the New York Mercantile Exchange, light, sweet crude for March delivery hit $35.25 a barrel -- the highest level since November 2000 -- before settling up 96 cents at $35.12.

On London's International Oil Exchange, March Brent crude oil hit $32.50 per barrel, also a two-year high, and closed up 90 cents at $32.34.

Heating oil posted a 23-year high of $1.113 a gallon before closing at $1.0957 a gallon, up 6.86 cents on the day.

Fuel suppliers in the Northeast, the world's biggest heating oil market, are seeking an emergency release of U.S. strategic stockpiles to ease shortages as heavy snows hit the region.

March gasoline futures rose 3.87 cents to close at $1.067 a gallon.

And natural gas futures rose 3.7 percent to a two-year high, cracking $6 per thousand cubic feet, also on concern over frigid U.S. weather. Gas for March delivery rose 21.5 cents to $6.043.

The oil rally got under way Wednesday after the Department of Energy reported an unexpectedly large decline in inventories.

Then on Friday, Attorney General John Ashcroft raised the nationwide threat level.

Traders believe an attack on Iraq would halt oil supplies from the producer and could also hit supplies from other Middle Eastern countries, which provide 40 percent of the world's 40 million barrels per day of oil exports.

Even as President Bush presses the case for using force in Iraq, U.S. consumption of Iraqi crude has been rising.

Imports rose 24 percent in January to 1.15 million barrels per day as the U.S. sought new suppliers to offset the loss from Venezuela.

The International Energy Agency, the West's energy watchdog, said OPEC exporters may have enough spare capacity to prevent the need for consumer countries to release strategic reserves in the event of war in Iraq. But if not, IEA Director Claude Mandil said he could order a release of emergency inventories within hours.

www.gulf-news.com Dubai |By Duraid Al Baik, Bassam Za'za' and Jay B. Hilotin | 08-02-2003

Will there be another Gulf War soon? If so, how soon? If not, why?

These are some of the questions asked in every guessing game and coffee shop talk these days as the U.S.-British coalition engages in a cat-and-mouse game of brinkmanship against Iraqi President Saddam Hussain.

But a sinister design of U.S. policy hawks to force democracy to the Arab world via Baghdad is being done not out of deep conviction for America's founding principles but to humiliate Arab leaders.

Dr MaksoudDr Clovis Maksoud, a Western-trained lawyer who resigned his post as Arab League Chief Representative to the UN after Iraq invaded Kuwait in 1990, made this stinging remark during a roundtable discussion at Gulf News main office recently.

The softspoken former diplomat, however, acknowledged the need for reform in the Arab world. "There exists in the Arab world a long tradition of reform. Sometimes the reformists succeed, sometimes they fail," said the former Arab League Chief Representative to the UN. "But reform must be a self-generated function of the people."

Dr Maksoud is one of the intellectual fathers behind the landmark Arab Human Development Report commissioned by the United Nations which acknowledged the "poverty of opportunity" that has afflicted the Arab people.

Dr Maksoud, stressed: "Work on this report was done way before the September 11 attacks. It was about the Arabs, done by the Arabs and for the Arabs."

But Dr Maksoud pointed out that America has a spotty record in espousing transparency and democracy in other countries.

"You can't go around demanding transparency and democracy on others while turning a blind eye on your own backyard that is being 'Enronised' right under your nose," he said.

He was referring to the numbers-fudging by top auditing firms that hid corporate greed from the balance sheets which led to the collapse of energy giant Enron, WorldCom as well as accounting firms likes Andersen.

Dr Maksoud, with a doctorate in jurisprudence from the George Washington University and did post-graduate studies at Oxford University in Britain, is currently a Professor of International Relations and Director of the Centre for the Global South at the American University in Washington.

During his recent visit to the UAE, he was joined by two leading Arab-Americans: James Sams, an Arab-American lawyer and president and CEO of Maryland-based American Development Services Corp.; and Abul Huda Farouki, a businessman who represents the Financial Instrument and Investment Corporation, based in Virginia.

Their mission was to lay down the foundation to build more bridges of understanding between Americans and Arabs.

For his part, Sams thinks that the strike on Iraq won't occur because the economic, political and strategic damage would be overwhelming.

"I believe that when it's about to press the go-ahead bottom, the U.S. administration will come to recognise more that the strike on Iraq is evitable. The economic, political and strategic cost is cheaper than it would be in case of a military action."

All threats and aggressiveness of Saddam Hussain could be contained. Yet the Bush Administration won't be able to contain the political uncertainty as well as the economic damage specially that uncertainty it will bring to the oil market.

Farouki believes that the degree of anti-American sentiment that exists throughout the Arab world isn't really understood clearly by most Americans.

He stressed the need for a "dialogue of civilisations", which would enrich the Americans' understanding of Arabs, and vice versa.

Following are excerpts of the roundtable:

Why do you think there will be no war? Sams: The arguments against the war from the purely American national interest perspective are persuasive. The economic consequences will be so potentially damaging as well as the political and strategic consequences.

SamsI think that by the end of the day the people who will make that final decision to push the go-ahead button will come to recognise that and will not do it.

I also believe that the large-scale U.S. military movement towards the Gulf is being made to create an impression or a clear capacity to go to war. I think that the U.S. deems that unless they pursue up to the degree they have done, they will never be able to contain Saddam Hussain's aggressiveness.

The Americans had Saddam contained for the last 10 years but at a very high price paid by the Iraqi people. Also Hussain, in a sense humiliated the UN and U.S. when he expelled and kicked out the weapon inspectors.

With this new effort at inspection, the ultimate consequence, I think, is that he will be contained. He might not be removed, but whatever threat he represents will be contained.

All that is a conjecture. Recently, a friend, Michael Hudson, told me that definitely the U.S. have gone so far towards war and now, if they don't go (to Baghdad), then that would be backing down.

There is a strong element within the State Department and Defense Department that is opposed to war; and I just believe that they all in the end prevail which I hope they do.

How long do you think that the argument over war - or no war - would take before a decision is made? Sams: The argument would last for the next several months. Some people think that it should take place sometime in February because of the weather conditions and which is another reason why I believe that there is going to be no war. I think that this the inspection process under the UN and the opposition from some of our allies such as Germany, France, China and Russia will make it difficult.

How do you think that would affect the U.S. economically? Sams: The political uncertainty in itself is tremendously damaging right now to the businessmen. And there's the cliché that if there's one thing businessmen cannot stand, it is uncertainty. And the one thing that Bush policies had brought to the economy in the last years had been uncertainty. Thus as a consequence the decisions to invest aren't being made.

You can tell just from the perspective of the stock market. It isn't the best gage of economic activity in the U.S., but nonetheless whenever there is a sense that war isn't eminent, the market shoots up.

But whenever there is a sense that war is eminent, the market goes down. It is, to a certain degree, fixed by the fear of rising energy prices that was mitigated when the Opec made a decision to say they'll match whatever they're loosing from Venezuela or whatever they would lose from Iran.

That's not enough! I think that the market recognises the damage of uncertainty is probably more than anything else."

FaroukiDo you think that the Americans are aware of the political price that they have to pay if they go to war? Farouki: I believe that the degree of anti-American sentiment that exists throughout the Arab world isn't really understood clearly by most Americans.

I've had the opportunity to travel to most of the Arab countries in the past two years, and since the September 11 crisis, I detected a growing anti-American sentiment on the part of a wide range of people, not just the street but at almost any level; academic, political, business and government."

The reason for the misunderstanding of anti-American sentiment in the US is the great deal of lack of understanding of Islam, the Arab world and Arab individuals and what motivates them to have such feelings.

How would the U.S. media or politicians explain to the American society the recent ambush attack on American troops in Kuwait or any similar acts?  Farouki: These acts don't play out well at all in the U.S. media. Any action directed against any American interest or individual obviously doesn't play well as far as the public is concerned.

It actually brings about or fosters an atmosphere of greater misunderstanding. It creates more negative feelings of the part of the Americans towards the Arab world. Those negative feelings exist and are growing.

Do you think that the American masses would rise up against war? Farouki: There is a growing feeling among the American people opposed to war. An evidence of this is the growing protests taking place.

I think that those protests are going to snowball and the number of people would also increase. I believe that it has to do with the fact that in general, Americans don't want to be part of the war effort.

There are a lot of negative experiences that occurred in the past with respect to going to war which are coming back into play right now. There is a very good chance that the anti-war protests will increase in size.

What is the main reason behind not going to war? Is it the political price, economic price or the opposition of people in the U.S.? Sams: I think it is a combination of all reasons, especially the recognition of the political and economical price that the U.S. will have to pay. Then there is the basic concern, which is the disruption to their lives or the number of casualties.

That is why there is such a strong emphasis by advocates of war that it will not produce many casualties because the strikes will be "surgical", the Iraqi people will erupt in joy when the war starts and welcome the liberators. They really emphasise that.

A lot of Americans believe that. Yet the closer we get (to war), the more they will come to recognise that the price will be heavy.

How do you explain the mounting mobilisation of U.S. and British troops in the area? Sams: They want to create the real potential for war. I don't want to call it a bluff. But there has to be this real potential, by mobilising the troops. If they weren't doing that, then there will be no movement on the part of Saddam Hussein.

The Americans want to make it very clear that in the absence of Saddam Hussein's compliance to the UN resolutions, he will have to face the consequences. If they didn't have this deployment then, it wouldn't take place. This is brinkmanship at its ultimate.

The ultimate decision makers will have enough good judgment to avoid war. I think the Americans have pulled back on the "regime change" as a primary objective. I haven't heard that rhetoric for quite some time. They are stressing now on disarming Saddam of his mass destructive weapons.

The real defined goal by the UN is the destruction of weapons of mass destruction, and it's very hard to determine precisely when they will have achieved that goal.

Clearly there is a process at work which is again one of the reasons why I don't believe that there is going to be war - because that process is strengthening and not weakening.

Now there is more support for the process of inspection and probably expanding it. Thus, I don't think there is a realistic prospect for a new UN resolution within the next several weeks. I think that the US would find it extremely unethical to launch a war in the base of all this UN activity taking place.

After the current period of uncertainty, do you think that the moderate Arab nations would be affected by calls for democracy and women's empowerment. Or would the U.S. forget about it later on or maybe help those nations to develop that sort of approach? Farouki: In the last couple of years, the U.S. media has really latched onto the business of introducing change in the Arab countries. They latched onto the main issues like lack of democracy, empowerment of women, transparency and corruption.

There has been so much publicity on those issues and I don't think that's going to stop. It will continue. War or no war, I think there will be more of that. I further believe that the American media had adopted this. Certain forces have actually made this an issue that the media will continue to focus on."      

· Bush tells UN to make up its mind · U.S. presence worse than Iraqi arms · Bahrainis stage demonstration · Gunmen fire at Briton working in Saudi firm · Democracy in Iraq `could reshape region' · Airborne troops, fifth carrier sent to Gulf · Reforms must come from people · Powell briefed former top officials · Step down or face war, Jordanians tell Saddam · Pentagon planning overseas funerals · Dinar first casualty in battle against U.S. · Woman held for stealing newborn · Analysis: Riyadh plans to rectify demographic imbalance · Project to build town in Hamraa area of Oman · Khimji felicitated in Oman  

www.taipeitimes.com By Kurt Weyland Saturday, Feb 08, 2003,Page 9

With Venezuela's leader determined to hang on to power, allowing the people to go to the polls could well be the only way out of the country's domestic turmoil

Venezuela is mired in a dangerous stalemate. Venezuelan President Hugo Chavez clings to power despite the obvious failings of his government in terms of severe economic deterioration and dangerous political polarization. The opposition, tainted by their botched coup of last April, now seeks to force Chavez from office through a costly general strike.

Both sides justify their intransigence with one-sided interpretations. His sympathizers glorify Chavez as a defender of the poor besieged by a selfish, coup-plotting elite. His fiercest opponents demonize Chavez as an autocrat pursuing a Cuban-style revolution and destroying democracy. Both interpretations are flawed. The Chavez government has not helped Venezuela's poor in any significant way. On the contrary, his belligerent rhetoric and inept governance scared off investors, inciting economic decline and boosting unemployment and poverty. Now Chavez lacks majority backing even among the poor.

The opposition comprises most of Venezuela's organized civil society, not only business, but also trade unions, professional associations, and non-governmental organizations. So Venezuela's polarization does not pit "the poor" against "the oligarchy," but a populist against civil society.

The opposition's view -- shared by rightists in the Bush administration -- is equally unconvincing. Rather than initiating a revolution, Chavez merely spouts fiery rhetoric. While his democratic credentials are dubious, he has not acted in an openly authoritarian fashion. True, he has systematically concentrated power in his own hands and has undermined governmental checks and balances. But while harassing the opposition, he has not overturned the minimal principles of democracy. Indeed, he now invokes his formal democratic legitimacy to fend off demands for his resignation.

But Chavez's insistence on the inviolability of the current constitution is hypocritical. Four years ago, Chavez deviated from the old constitution by using a plebiscite to engineer a new one, tailor-made for him. Now he invokes that charter to block calls for a plebiscite on his continuation in office.

The paradox here is that Chavez's earlier example may provide the solution to today's standoff. As Chavez used para-constitutional means to advance a desire for change in 1999, so the international community should not be confined by the present constitution in pressing to resolve a crisis that is ruining the country.

In fact, the Latin American members of the "group of friendly nations" trying to mediate this conflict can draw on interesting experiences to design such a solution. After all, confrontations like this are not unusual in Latin America's rigid presidential systems. When chief executives with fixed terms of office lose political support, they cannot be removed through a no-confidence vote, as in parliamentary systems. Presidential systems therefore risk lengthy stand-offs that threaten democracy -- as in Venezuela today.

But over the last decade, Latin American politicians have made presidential systems more flexible by finding innovative ways to remove unpopular presidents. One of Chavez's discredited predecessors was impeached on flimsy charges of malfeasance; Ecuador's Congress declared a disastrous chief executive "mentally incompetent;" in Peru, an autocratic president, after months of domestic and international pressure, was forced into exile.

While politicians interpreted the law with a good deal of creativity in these instances, they usually did so to ensure the survival of fragile democracies facing a crisis. As long as these maneuvers do not proliferate and turn into easy ammunition for the opposition of the moment, they may provide a safety valve for presidential systems.

It is to be hoped that the group of friendly nations can help design an innovative solution to Venezuela's standoff. To be acceptable to both sides, such a solution must deviate from the favorite proposals of each. The opposition prefers an "up-or-down" vote on Chavez's continuation in office, which it would most likely win -- and which Chavez will never accept.

Chavez insists on the recall referendum mechanism included in his constitution, which the opposition cannot tolerate -- removing the president in this way would require a larger absolute number of votes than Chavez garnered in the last election. But rising abstention makes this virtually impossible.

Only a democratic mechanism for conflict resolution that has an uncertain outcome has any chance of being adopted. That mechanism is an election, to be held as soon as possible. Both sides will have to work hard if they want to win. The fractious opposition will need to go beyond rejection of Chavez, elaborate a program for the country's reconstruction and unite behind an attractive candidate.

Chavez will need to clarify the content and meaning of his "Bolivarian Revolution." Since Chavez is a skilled campaigner and the opposition so far lacks unity, he will have a realistic chance of winning -- which should make a new contest acceptable to him. Pressure from the group of friendly nations may induce both sides to accept this last chance to avoid a political and economic meltdown.

Elections can be made legitimate through a constitutional amendment shortening the presidential term, as proposed by former US president Jimmy Carter in his recent mediation effort. Since this is designed to defuse an exceptional crisis, it would not become a precedent that encourages frivolous attacks on Latin America's democratically elected governments. An election now in Venezuela will save, not undermine, democracy.

Kurt Weyland is an associate professor of government at the University of Texas and author of The Politics of Market Reform in Fragile Democracies: Argentina, Brazil, Peru, and Venezuela.

www.voanews.com VOA News 08 Feb 2003, 02:58 UTC

Former U.S. President Jimmy Carter says the Venezuelan president and his opponents are making progress to end a nationwide crisis and a crippling strike.

Mr. Carter, who has been negotiating a resolution to the conflict, said Friday that the two sides are committed to a political agreement to end their differences.

He said Venezuela's constitution allows for a recall referendum or a constitutional amendment to allow for early elections.

Opponents of President Hugo Chavez have started collecting signatures for initiatives aimed at cutting short his term in office.

Mr. Carter has also been working with the head of the Organization of American States, Cesar Gaviria, in the resolution process.

www.nytimes.com By MARCI ALBOHER NUSBAUM

Being sent to Miami on business is usually a lot more like pleasure, especially when the rest of the country is enduring the big chill.

But brush up on your Spanish. Some frequent visitors say they have trouble even getting around the airport without a smattering of the language. And do not assume most Latinos in Miami are Cuban. While the Cuban population has the deepest roots and most political power, an influx of immigrants from Paraguay, Venezuela, Columbia and Mexico has brought the number of non-Cuban Hispanics almost equal to the number of those of Cuban ancestry.

AIRPORT

If your business has anything to do with Latin America, you can't avoid MIAMI INTERNATIONAL AIRPORT, which ranks third in the United States for international traffic. With only one terminal and an alphabet of concourses to navigate, make sure to leave ample time to get around, especially if you have a connecting flight. Built in 1959, when the traffic was 4.2 million passengers a year, compared with 31 million in 2002, the infrastructure has grown creaky. Advertisement

But there is hope. A $4.8 billion construction project is under way, and already two concourses have been transformed into sun-drenched, airy spaces with terrazzo floors embedded with shimmering brass inlays. And a new food court with a California Pizza Kitchen has won praise from business travelers grateful for a break from fried fare.

HOTELS

With refurbished Art Deco gems sprouting like mushrooms in South Beach, arguably the most chic stretch of beach in the country, deciding which one to book isn't easy. Monique Skruzny, senior vice president for investor relations at AOL Latin America, says the NATIONAL (800-550-0505, from $189) is a standout.

"While the SHORE CLUB or DELANO may win points for hipness, I prefer the home-away-from-home feel of the National, where I know I'm going to see the same faces at the front desk each time I visit," she said. Special touches abound, like free homemade strawberry-flavored lemonade at check-in, free Internet service in the lobby cafe and $9-to-$12 meals for the return flight home. Ms. Skruzny also recommends the wine club. "For $20 you can mingle with an international beach set of upscale professionals," she said.

One reason to venture away from the beach is the posh MANDARIN ORIENTAL on Brickell Key (305-913-8288, $250) in downtown Miami. The Mandarin's spa takes pampering seriously. Ask about booking one of the private spa suites with their whirlpool tubs, spa cuisine meals and indulgent treatments. AZUL (305-913-8254, $145 for dinner for two with tip and wine), the hotel's waterfront restaurant with its star chef, Michelle Bernstein, is a local favorite. If that is beyond your budget, the CAFE SAMBAL (305-913-8251, $80), the hotel's more moderate restaurant, lets you enjoy the Mandarin's ambience at a fraction of the price.

RESTAURANTS

When Joaquin F. Blaya, the chief executive of Radio Unica, the only Spanish-language radio network in the United States, entertains advertisers or bankers, he takes them to LA DORADA (305-446-2002, $100), known for its imported seafood. La Dorada's general manager, Beatrice Bajares, says the fish is hand-selected daily at the port in Malaga, Spain, and flown directly to Miami. "My guy calls me from the port each morning at 5:30 and I tell him what I want," she said.

For a more casual meal, try JERRY'S DELI (305-532-8030), a New York-style deli, open round the clock, with more than 500 menu choices ranging from standard deli fare to what Jerry's calls "high-energy California cuisine."

According to Tara Gilani, a local media personality known as "the trend tracker," Miami's elite — from politicians to fashion models — has made the PALM (305-868-7256, $150) in Coral Gables their haunt. "You know you've made it in Miami if your caricature is on the wall of the Palm," she said.

If you've just been promoted or are closing a big deal, Ms. Skruzy suggests NORMAN'S (305-446-6767, $150). For a more intimate setting, she likes ORTANIQUE (305-446-7710, $140) in Coral Cables with its "spectacular Caribbean food."

ON YOUR OWN

With 15 miles of sand, one pastime is obvious. But Miami has also developed a serious art scene. Two collections worth a visit are the BASS MUSEUM OF ART (305-673-7530) and the WOLFSONIAN-FLORIDA INTERNATIONAL UNIVERSITY gallery (305-531-1001), both in South Beach.

NIGHT LIFE

In a town where even Janet Reno has been spotted at trendy clubs, there is no excuse to turn in after dinner. For celebrity sightings, from Bill Clinton to Britney Spears, the place to be is LEVEL (305-532-1525, $20 cover charge), which Ms. Gilani calls a "banging disco palace, a huge cavernous place, but with enough nooks and crannies that good people can do bad things."

If exclusivity is the aim, then she would recommend MYNT (786-276-6132, $20 cover charge) "It's small and chic and hard to get into, like all good lounges should be," she said.

PRACTICAL TRAVELER; Sold! Travel by Online Gavel