reuters.com Tue February 18, 2003 02:54 PM ET

NEW YORK (Reuters) - Oil prices forged to fresh 29-month highs on Tuesday as the United States and Britain pushed for a second U.N. resolution on Iraq that could open the way to war on the world's eighth largest oil exporter.

A snowstorm that swept across the eastern United States over the weekend supported prices, boosting heating demand at a time when U.S. fuel stocks have already fallen well below normal levels.

U.S. crude futures, which were closed on Monday for the Presidents' Day holiday, rose 25 cents to $37.05, the highest level since September 2000, and barely four dollars below peaks struck during the 1990-1991 Gulf War.

International benchmark Brent crude oil rose 63 cents to $32.55 per barrel, within a dollar of its two-year high of $33.10 hit last week.

Prices rose as the White House said it could propose a new U.N. resolution as soon as this week calling for the use of force to disarm Iraq. The United States has said it will act without U.N. agreement if necessary.

"It could take place as soon as this week. It could be next week. The timing will be determined as a result of the ongoing conversations within our government and with the allies," White House spokesman Ari Fleischer said.

Traders fear military conflict in Iraq could upset oil flows from the Middle East, which pumps nearly a third of the world's crude. An 11-week workers strike in Venezuela has already depleted world oil supplies.

The Defense Department has ordered a further 28,000 troops to the Gulf region as the United States builds a military force of more than 200,000 for a possible war with Iraq, military officials said on Tuesday.

European Union leaders closed ranks on Monday to warn Iraq that United Nations arms inspections could not go on indefinitely without Baghdad's cooperation and declared for the first time that war could be the last resort.

"An attack at the end of February through to the middle of March still seems almost inevitable," said Lawrence Eagles of brokers GNI.

IRAQ URGES OIL AS ANTI-WAR WEAPON

Iraqi Foreign Minister Naji Sabri urged Arab nations to use their massive oil wealth as a weapon against war. A similar plea fell on deaf ears last April, when Iraq urged an embargo to protest Israeli violence against Palestinians.

The Arab-dominated Organization of the Petroleum Exporting Countries has vowed to do its best to cover any shortfall in Iraqi supply.

OPEC will probably suspend oil output quotas temporarily and pump at will in the event of war cutting off Iraqi supplies, an OPEC source said on Monday.

U.S. households are already facing higher heating costs, after heating oil futures rose to their highest level since 1979 this month. Supply has tightened as high crude prices force domestic refiners to cut back production.

After a series of severe storms in the U.S. northeast already this winter, the world's largest heating oil market was again battered by Arctic cold this week.

Heavy blizzards hit New England on Monday, closing most major airports between Washington and New York. Temperatures in the Northeast are forecast to rise this week then fall back again.

Concerns are rising that the scramble to meet heating demand will prevent refiners making enough gasoline to meet summer vacation demand, meaning higher prices at the pump later this year.

Another potential supply disruption loomed as Nigerian oil workers threatened to cut off exports from Africa's top producer in a strike that began on Saturday.

Blue-collar Nigerian oil workers joined a strike by white-collar workers on Tuesday, but oil companies managed to maintain exports using senior staff to replace strikers.

Talks on ending the strike have been postponed by one day to Wednesday to ensure fuller attendance.

news.ft.com By Andy Webb-Vidal in Caracas Published: February 18 2003 19:28 | Last Updated: February 18 2003 19:28

Venezuelan government and opposition representatives on Tuesday signed a pact condemning political violence - the first breakthrough in three months of internationally backed talks aimed at finding an electoral solution to the country's political deadlock.

The agreement, brokered by César Gaviria, secretary-general of the Organisation of American States (OAS), should ease tensions between the government of President Hugo Chávez and the alliance of opposition interest groups ranged against him, analysts said.

Venezuela has been marked by rising levels of street violence, including several deaths in recent months, as timid efforts at dialogue collapsed between Mr Chávez and his foes in the wake of last April's coup attempt prompting the involvement of the OAS.

Opponents say Mr Chávez, although democratically elected four years ago, is bent on abolishing democracy in favour of an autocratic leftist government modelled on that of Cuba's Fidel Castro.

In turn, the populist Mr Chávez, who led a failed military coup in 1992, brands the opponents of his self-styled "Bolivarian revolution" as "coup-plotters".

Among his opponents are more than 12,000 workers who have been fired from Petróleos de Venezuela (PDVSA), the state oil company, following an ongoing strike that began in December and has slashed output in what was the world's fifth-largest oil producer with crippling results for the economy.

Analysts said the non-violence agreement suggested some kind of election could be in the offing in the months ahead. "The pact demonstrates that it is possible to reach agreements, and if that is possible, then anything is," said Alfredo Keller, a political consultant.

"However, the impression I have is that Chávez is not interested in an election in which he participates. He is not going to permit that the only visible head of the 'revolution' runs the risk of an electoral defeat," said Mr Keller.

Mr Chávez has in the past two weeks stepped up measures apparently aimed at shoring up his base support among the poor, a move designed to prepare for polls in which regional governors and mayors participate.

But, within the opposition camp, hopes of an early ballot, this year are being pinned on a presidential election with conspicuous signs that Manuel Cova, secretary-general of the Venezuelan Workers Confederation, is being groomed by some groups as a potential single candidate.

www.vheadline.com Posted: Tuesday, February 18, 2003 By: Gustavo Coronel

VHeadline.com commentarist Gustavo Coronel writes: Dark ages can come to a society at any time. They came to Europe after the fall of the Roman Empire and lasted several centuries. It was a time of economic and political disarray, in which life became bleak and miserable. The continent was invaded by barbarians: Huns, Goths and Vandals. Normal social life largely disappeared. Families depended on neighbors more than in a government. Money was replaced by barter.

In Venezuela we are entering our "mini" Dark Ages. Only in 1975, Venezuela still had one of the largest per capita GNP's of all middle to upper income countries in the rankings of the United Nations. The population in poverty was 5%, yes, you read right... The projections of poverty for year 2000 were no bigger than 3%. ("The Economics of Developing Countries", E.W. Nafzinger, 1984). Today the state of poverty includes almost 80% of the Venezuelan population.  Some has gone very wrong in the last 20 years, especially in the last 4 years.

Today our credit cards are no longer valid for most transactions. Venezuelan-issued credit cards will not be valid abroad beyond $1,000. Food market shelves are half empty. Basic products such as milk, margarines, ice creams, cheeses, breads, are getting difficult to obtain.

Although exchange controls were announced almost a month ago, in open violation of a ruling by the Supreme Tribunal of Justice, the regime still has not put the mechanisms in place. As a result Venezuela has lived almost a month without legal foreign exchange. A black market has appeared in which the dollar sells for about Bs. 2,400, already 50% in excess of the official rate.

In parallel, the regime has established price controls for about 100 products such as rice, flour, cooking oils, milk, chicken, disposable diapers and the like. Producers are claiming that many of these prices are set below production costs and that no one can be obliged to sell below costs. The President has challenged them to close their plants so he can militarize them. Rationing is in the near future, as a consequence of this new conflict.

Gasoline imports are still insufficient to satisfy the local demand, although the arrival of two or three tankers at any given time has the effect of easing temporarily the long lines of cars waiting outside the gasoline stations.

The Venezuelan refineries are not yet in operation, in spite of the efforts made by the mercenary group of technicians brought in by the regime. Most available gasoline is being sent to "friendly" States while the "enemy" States such as Zulia, Carabobo and Anzoategui are not getting much.

Neighbors are closing ranks and sharing what they have. Car pools, bicycling and plain walking are now common. Suddenly we are all poor, some because they have no money, some because they have money but nothing to buy. Bartering is increasingly taking place.

As the economy collapses around us the President has gone into a frantic campaign on national TV.  Compulsory "hook ups" are now daily affairs, in which the President will talk about anything, including the attempts made by voodoo witches to "do a job on him."  The President firmly believes in witchcraft and has developed a personal religion which is a mixture of Catholicism, voodoo and Marxism.  In these daily shows he tries to provoke the opposition into violent action, since he feels that this is what he needs to justify an open dictatorship. Frankly, some of the things he is doing more than justify a violent outburst. He has brought to the National Pantheon, to rest with our heroes, the remains of Cipriano Castro, a mediocre Venezuelan dictator during the period 1899-1908. This is an insult to all Venezuelans as this man ... called "The Lewd Monkey" by his contemporaries ... spent most of his time drinking, dancing and engaged in sexual orgies. When his kidneys gave out he left to Europe to be operated and was never allowed to return by his "compadre" J. V. Gomez.

• Another act of provocation is the current attempt at passing a Law to regulate the freedom of expression. The Law itself is an insult to the intelligence and, if passed, will mean the death of free press in the country, at least while Chavez is in power.

Watching and listening to Chavez nowadays leaves very little doubt in our minds that the man is mentally deranged.  All pretenses at being a Statesman are gone, governing is no longer an objective. His words and body language are full of hate and desires for the destruction of his "enemies".

Europe endured an Attila and a Gunseric. We have our Chavez and our Rangel.  The former have already long disappeared into the dustbin of history ... in a few more months the rest will follow.

Gustavo Coronel is the founder and president of Agrupacion Pro Calidad de Vida (The Pro-Quality of Life Alliance), a Caracas-based organization devoted to fighting corruption and the promotion of civic education in Latin America, primarily Venezuela. A member of the first board of directors (1975-1979) of Petroleos de Venezuela (PDVSA), following nationalization of Venezuela's oil industry, Coronel has worked in the oil industry for 28 years in the United States, Holland, Indonesia, Algiers and in Venezuela. He is a Distinguished alumnus of the University of Tulsa (USA) where he was a Trustee from 1987 to 1999. Coronel led the Hydrocarbons Division of the Inter-American Development Bank (IADB) in Washington DC for 5 years. The author of three books and many articles on Venezuela ("Curbing Corruption in Venezuela." Journal of Democracy, Vol. 7, No. 3, July, 1996, pp. 157-163), he is a fellow of Harvard University and a member of the Harvard faculty from 1981 to 1983.  In 1998, he was presidential election campaign manager for Henrique Salas Romer and now lives in retirement on the Caribbean island of Margarita where he runs a leading Hotel-Resort.  You may contact Gustavo Coronel at email ppcvicep@telcel.net.ve

www.vheadline.com Posted: Tuesday, February 18, 2003 By: Patrick J. O'Donoghue

US Ambassador to Venezuela Charles Shapiro is promoting what he calls informal meetings with all sectors in the current dispute in an attempt to break down the wall of silence.

“Society is completely polarized … somebody said that there is a kind of invisible Berlin Wall running through Caracas and it’s true … people aren’t talking to each other.”

Shapiro says elections are not enough to heal the deep rift in Venezuelan society and any potential political agreement between government and opposition leaders could make things worse instead of better.

Shapiro suggests that people start looking at the reconciliation process in South Africa as a possible model … “they accomplished a civil consensus vis-à-vis the political breakdown of a white minority … informal committees were a key element in the process.”

• Members of the US Congress Venezuelan Caucus are in Venezuela holding informal sessions on a parliamentary level as part of the Ambassador's new policy.

Shapiro insists that informal sessions will help the official negotiating team to reach an agreement, especially a non-aggression pact … “grassroots and community groups must also be included in the process … if agreements can be reached at that level, it will help a great deal.”

2003-02-18 14:25 EST - News Release

VANCOUVER, Feb. 18 /PRNewswire-FirstCall/ -- Vannessa Ventures Ltd. (VVV: TSX, OTC-BB: VNVNF, Berlin: VVT - WKN 914781) is pleased to announce that the court action to nullify the cancellation of the Minera Las Cristinas C.A. (MINCA) contract by Venezuela's state-owned Corporacion Venezolana de Guayana (CVG) is progressing. In addition, MINCA's court proceedings against CVG for contractual non-compliance have been admitted for hearing by the Supreme Court. The case will deal with CVG's actions as a shareholder of MINCA and its obstruction of MINCA's attempts at advancing the project.

MINCA, 95 % owned by Vannessa's wholly owned subsidiary in Venezuela, is the holder of a work contract to develop the Las Cristinas Project and has invested over US$170 million to advance the project to the feasibility stage with a proven gold reserve exceeding 11 million ounces.

In August 2001, CVG advised MINCA of its intent to cancel the contract and refused to follow the arbitration process as agreed to in the CVG/MINCA contract. In November 2001, CVG unilaterally cancelled the MINCA contract and, without any legal court order, engaged military personnel to take possession of the mine and of MINCA's assets.

MINCA filed an action in the Venezuelan Supreme Court asking the court to reverse the CVG cancellation of the Contract and to restore the contract effective to the cancellation date.

This legal action is now proceeding. Last week, CVG made its case for the unilateral cancellation of the contract by alleging MINCA's lack of reporting over a four-semester period and referring to the fact that start-up of the Mine occurred after July 15, 2001. MINCA filed its evidence, which included proof that the requested reports were in fact in the possession of CVG when it made its allegations that MINCA had not filed the reports.

MINCA also maintained that it was at no time to blame for lack of development. In 1997, a title dispute between Inversora Mael (a Crystallex subsidiary) and CVG caused mine construction to be suspended until a Supreme Court ruling in 1998 confirmed CVG's rights due to the fact that, among other reasons, Mael had no standing in court to bring forward a title challenge since it never held mining rights to the properties. With the price of gold dropping below US$300, CVG and MINCA agreed to a suspension of construction until July 15, 2002.

Furthermore, the parties hired an international investment bank to help find a solution for the impasse; however the bank terminated its involvement citing a complete lack of co-operation by CVG. MINCA also provided written evidence that CVG prohibited its directors from attending MINCA's directors meetings to approve planned project developments and therefore willfully obstructed MINCA from proceeding with its development plans.

Vannessa has also formally notified the Venezuelan Government of its intent to enact international arbitration under the Venezuelan-Canadian Agreement for Promotion and Protection of Investments.

"MANFRED PESCHKE" Manfred Peschke, President VANNESSA VENTURES LTD.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release. Vannessa Ventures Ltd.

CONTACT: Vannessa Ventures Ltd., 1710-1040 West Georgia Street, Vancouver, B.C., Canada, V6E 4H1, Tel: 604-689-8927, Fax: 604-689-8907, E-mail: info@vannessa.com, Website: www.vannessa.com