www.heraldtribune.com By STEPHEN IXER Associated Press Writer

Venezuelan general strike leader Carlos Fernandez, center, surrounded by secret police officers, arrives at the court building in Caracas, Venezuela, Friday, Feb. 21, 2003. Thousands protested Fernandez's arrest, across the country, and nine people were injured in clashes with police in the central city of Valencia Thursday. A leading opponent of President Hugo Chavez who helped lead a two-month national strike was put under house arrest Sunday while charges are prepared against him. Carlos Fernandez, president of the Fedecamaras business chamber, was seized Wednesday by secret police on charges including treason, civil rebellion and incitement to commit offenses. Just over 72 hours later, a judge struck down three of the five charges, treason among them. Rebellion and incitement charges were upheld, said Pedro Berrizbeitia, one of Fernandez's lawyers. Secret police rushed Fernandez, 52, out of the courthouse to be taken to his home in Valencia, 66 miles west of Caracas, while prosecutors formalize the accusations against him. Dario Vivas, a pro-Chavez legislator, said he would challenge the decision to put Fernandez under house arrest, claiming the civil rebellion charge warrants prison. The judge's decision was announced at 2 a.m. Sunday, 13 hours after the hearing began. Strike co-leader Carlos Ortega remained at large on Sunday. As president of the Venezuelan Workers Confederation, he partnered with Fernandez in spearheading the work stoppage that paralyzed the vital oil industry and devastated the economy. Ortega said he was going into hiding after a warrant was issued for his arrest on Thursday. Chavez has demanded 20-year jail sentences for Fernandez and Ortega, alleging they sabotaged oil installations, incited civil disobedience and trampled Venezuelans' human rights. The two-month strike caused food and gasoline shortages nationwide and cost Venezuela over $4 billion. The United States, the Organization of American States and human rights group Amnesty International voiced concern that Venezuela's crisis is escalating. Chavez rejected the claims. "Venezuela is nobody's colony!" he shouted. "We do not accept and we will not accept outside interference in our own affairs." The Venezuelan American Chamber of Commerce and Industry, which supported the strike, expressed its support for Fernandez and Ortega on Saturday. Anti-Chavez lawyers said Fernandez's detention was riddled with problems. The arrest warrant was issued by a judge who had acted as defense attorney for Chavez supporters accused of shooting at opposition marchers before an April coup that briefly toppled Chavez. The case was transferred to a new judge Friday, but Saturday's hearing extended well beyond the court's 7 p.m. closing time and Fernandez's 48-hour detention limit. The hearing was held behind closed doors and under tight security. Soldiers wearing riot gear guarded the Caracas courthouse while a crowd of Chavez supporters waited outside. National guardsmen kept journalists away from the courtroom entrance and Fernandez was closely escorted by secret police officers. Adding to the daylong tension, one soldier accidentally set off a tear gas canister in the courthouse corridor shortly before midnight Saturday, sending journalists running. The OAS, the United Nations and the Carter Center, run by former President Jimmy Carter, have sponsored three months of talks to seek an electoral solution to Venezuela's crisis. The future of those talks was put in doubt after Fernandez's arrest. Venezuela's opposition wants early elections and staged the national strike to back its demand. It has also collected more than 4 million signatures petitioning to cut Chavez's term in power. The government dismisses the petition drive and consistently accuses the opposition of "coup-plotting." Chavez is a former paratrooper who was elected in 1998 and re-elected in 2000 to a six-year term. Critics accuse him of imposing an authoritarian state and driving the economy into the ground.

www.kansascity.com Posted on Sun, Feb. 23, 2003 STEPHEN IXER Associated Press

CARACAS, Venezuela - A leading opponent of President Hugo Chavez who helped lead a two-month national strike was ordered held under house arrest Sunday.

Carlos Fernandez, president of the Fedecamaras business chamber, was seized Wednesday by secret police on charges including treason, rebellion and inciting criminal acts.

A judge struck down three of the charges, including treason, in a 13-hour hearing that ended early Sunday. The rebellion and incitement charges were upheld, said Pedro Berrizbeitia, one of Fernandez's lawyers.

Meanwhile, pro-Chavez gunmen ambushed a group of policemen overnight, killing one officer and wounding five others, said Miguel Pinto, chief of the police department's motorcycle brigade.

The officers were attacked Saturday night as they returned from the funeral of a slain colleague and passed near the the headquarters of the state oil monopoly, which has been staked out by Chavez supporters, some armed, since the strike began in December.

After a series of attacks on police by pro-Chavez gunmen, Police Chief Henry Vivas had ordered officers to stay away from the oil company headquarters to avoid any clashes with Chavez supporters. But the funeral home is located only several blocks away.

"We never thought it would come to this," Pinto said.

Chavez's government had seized thousands of weapons from city police on the pretext that Vivas had lost control of the 9,000-member department. Critics allege Chavez is disarming police while secretly arming pro-government radicals, a charge denied by Chavez's supporters.

After Fernandez's overnight court hearing, secret police rushed Fernandez out of the courthouse to be taken to his home in Valencia, 66 miles west of Caracas.

Strike co-leader Carlos Ortega remained in hiding after a warrant for his arrest was issued. As president of the Venezuelan Workers Confederation, he and Fernandez spearheaded the work stoppage that paralyzed the vital oil industry and devastated the economy.

Chavez has demanded 20-year jail sentences for Fernandez and Ortega, alleging they sabotaged oil installations, incited civil disobedience and trampled Venezuelans' human rights.

Fernandez's hearing was held behind closed doors and under tight security. Soldiers wearing riot gear guarded the Caracas courthouse while a crowd of Chavez supporters waited outside.

The two-month strike, which ended Feb. 4 in all sectors but the oil industry, caused food and gasoline shortages nationwide and cost Venezuela over $4 billion.

Lawyers said Fernandez's detention was riddled with irregularities - including his right to a preliminary hearing within 48 hours of his arrest.

The arrest was ordered by a judge who had acted as defense attorney for Chavez supporters accused of shooting at opposition marchers before an April coup that briefly toppled Chavez.

The Organization of American States, the United Nations and the Carter Center, run by former President Jimmy Carter, have sponsored three months of talks to seek an electoral solution to Venezuela's crisis. The future of those talks was in doubt after Fernandez's arrest.

Venezuela's opposition wants early elections and staged the national strike to back its demand. It collected more than 4 million signatures demanding an early vote. The government dismisses the petition drive and accuses the opposition of "coup-plotting."

Chavez is a former paratrooper who was elected in 1998 and re-elected in 2000 to a six-year term. He vows to distribute Venezuela's oil riches to the poor. Critics accuse him of imposing an authoritarian state and driving the economy into the ground.

www.presstelegram.com214741198150,00.html Article Last Updated: Saturday, February 22, 2003 - 8:04:09 PM PST By Andrew Blazier, Staff writer

Bolstered by consumer fears of a looming war with Iraq and national and global supply shortages, gas prices statewide are surging even higher.

Prices hovered anywhere from $1.90 to $2 per gallon Saturday at many Long Beach area stations.

A gallon of regular unleaded self-serve gasoline cost Californians $1.93 on average the highest in the nation. Drivers in the Los Angeles area paid an average of $1.89 for regular unleaded, up 25 cents from the previous month and 59 cents from February 2002, according to the Auto Club of Southern California.

"It's ridiculous,' said John Flores, 18, of Covina, after spending $1.82 per gallon at an ARCO. "You put in $5 and you barely get two gallons.'

He said it would cost him $40 to fill up his Mitsubishi Montero Sport.

A man who buys bulk fuels for Cosby Oil Co. in Santa Fe Springs said prices are bound to go even higher.

"Everything's kind of changing for the worse for the consumer,' Bob van der Valk said. "I see it shooting right by $2. We won't even blink an eye this time.'

Worried the global supply of crude oil might fall quickly if the country goes to war, the nation's oil companies bought up existing supplies rapidly. The hurried buying has driven crude prices up 19 percent since the start of the year to $36.79 per barrel.

About 40 percent of the retail cost of gasoline is attributed to the price of crude oil, according to John Cogan, energy information specialist for the Energy Information Administration in Washington, D.C.

Alaska North Slope crude, which makes up 20 percent of California's supply, reached $36.81 per barrel this week, up from $30.55 per barrel on Jan. 2, according to the California Energy Commission in Sacramento.

Besides war, global supply has been hurt by a two-month oilworkers' strike in Venezuela and a minor strike in Nigeria.

Within California, oil supplies have dropped about 6 percent, as refineries transition from fuel containing additive MTBE to fuel that uses cleaner-burning ethanol instead, van der Valk said. The majority of the state's gas companies plan to begin the switch by March 15, which could affect prices until October, when supplies return to normal.

"In our industry, it seems like bad news comes in threes,' he said. "You've got a recipe for disaster.'

Oil supplies weren't helped Friday. A massive explosion at an ExxonMobil Corp. oil storage facility in Staten Island, N.Y., pushed crude oil prices up more than a dollar in trading Friday. Heating oil and gasoline futures also surged.

"The most important factor is the price of crude oil on the world market,' said Rob Schlichting a commission spokesman. "That's a direct result of war fears and the country's Mideast policy.'

www.washingtonpost.com Sunday, February 23, 2003; Page H02

With premium gasoline at $2 a gallon and rising in Washington and other metropolitan areas, the economy and the seemingly impending war suddenly became one story.

A month-long national strike in Venezuela, colder-than-usual weather in the eastern United States and speculation by energy traders that a U.S. attack on Iraq could send prices skyrocketing have contributed to the 30-cent-a-gallon increase in pump prices over the past 10 weeks. But also a factor is a chronic short supply, reflecting the reluctance of major oil companies in recent years to increase investment in new sources of oil outside the Middle East. The companies fear that crude prices are likely to fall back below $25 a barrel before long, making it difficult to earn a decent profit from oil that will almost certainly be more expensive to find and pump.

It didn't help the mood of energy markets Friday when a barge carrying 4 million gallons of refined gasoline exploded at an Exxon Mobil terminal on Staten Island, sending clouds of dark smoke over New York Harbor and unfounded rumors of a terrorist attack ricocheting around trading rooms. This is a market in which small changes in supply or sentiment can result in big changes in price, and panic buying by nervous traders Friday drove the price of a gallon of crude for delivery next month above $37 a barrel before settling down to $35.50.

Politicians and economic forecasters have learned that they ignore big swings in fuel prices at their peril. It is not just that energy is a cost that affects the price of producing just about everything -- just look at the 1.6 percent increase in producer prices in January. Nor can its importance be fully explained by the fact that, in a country that relies on imports for most of its energy, much of the increase in the price of oil and gas flows outside the country. Just as significant, history shows that big increases in fuel prices seem to have an outsized effect on the psyches of consumers who get angry and apprehensive when the pump rushes past $40 as they stand there filling up their Chevy Blazers.

Don't look for relief anytime soon. With stocks of crude oil and refined products now below their five-year averages, even the disappearance of the war premium could be largely offset by the normal seasonal effect that comes as refiners begin to build gasoline inventories in anticipation of the summer driving season.

www.nytimes.com By PATRICK McGEEHAN

AS the world braces for potential war in Iraq, oil prices are at their highest in more than two years, and the profits of big oil producers and refiners have been rising along with them. But the lagging prices of oil-company stocks illustrate just how tricky it can be to speculate in the energy sector.

Professional oil traders place such bets every day, but few individual investors have been tempted, even as the drumbeat for war has grown louder. The New York Mercantile Exchange tried to attract more small investors last summer, when it introduced scaled-down versions of its main oil and natural-gas futures contracts, but those products "haven't really taken off yet," said Nachamah Jacobovits, a spokeswoman for the exchange.

On average, just 709 of these "mini" oil contracts and only 232 of the smaller natural-gas contracts change hands daily, Ms. Jacobovits said. She said individual investors seemed more inclined to bet on gold, a traditional hedge against inflation and economic upheaval. Trading in gold futures at the exchange is at a record, she said, with average daily volume of more than 61,000 contracts, up 60 percent from last year.

Oil trading is considerably more complicated than the gold market because oil prices are affected by so many forces of supply and demand. Lately, investors have been factoring in labor strife and disruptions in Venezuela and Nigeria, as well as an explosion on Friday at an Exxon Mobil fuel facility in New York.

According to the prevailing view among big investors, any war will probably be short and will be followed by a flood of new Iraqi oil that could halve the price of oil, now $35.58 a barrel, said John S. Segner, manager of the $275 million Invesco Energy fund. That expectation, he said, has been holding back the stocks of major oil companies the fund owns, like ChevronTexaco, BP and TotalFinaElf of France.

ChevronTexaco's stock, whose dividend yield is a healthy 4.37 percent, is down about 30 percent from its 52-week high of $91.60. BP, which yields 4.17 percent, is about 26 percent below its 52-week high of $53.98.

"The valuations of the companies don't reflect $35-a-barrel or even $25 crude, more like $19," said Mr. Segner, adding that he is bullish on big oil and skeptical about a quick and sharp increase in postwar supply. "I don't think it's going to be near as dramatic as that," he said. "The only way I see oil going below $20 is some unforeseen, dramatically negative economic event."

Too many investors are looking back to the Persian Gulf war as a guide, he said, but conditions are quite different now than in 1990. Most notably, he said, the inventory of oil is much lower than it was then, and the United States economy is coming out of a recession, instead of entering one.

Mr. Segner said he expected that a brief, successful war with Iraq would push oil prices back down to around $25 a barrel. At that level, efficient producers should continue to make a lot of money, he said. Unfortunately, he added, the returns on energy stocks diminish when oil prices spike as they have in the last few months. "They don't pay you when the prices get this high," he said.   DESPITE the boom that energy companies have been enjoying in recent months, funds like Invesco Energy have not thrived. The fund lost about 4.3 percent of its value last year, and it has lost almost 1 percent more so far this year.

Although those numbers are relatively strong for mutual funds that specialize in energy stocks, Mr. Segner characterized the flow of money into the fund as "not really going up, not really going down."

Rather than spending time speculating on the short-term direction of oil prices by buying or selling futures contracts, individual investors would be better served by studying the factors that will drive supply and demand, he said. As soon as the war in Iraq — if there is one — is over, oil drillers and refiners will face the challenge of finding and storing enough oil and natural gas to last the year.

"We're going to be struggling all year long just to refill to get ready for next winter," he said.