www.timesdaily.com The Associated Press March 06. 2003 6:25PM

Crude oil futures rose moderately Thursday as traders braced for a potential war in Iraq. But trading was volatile, reflecting market uncertainty ahead of a news conference Thursday night by President Bush. The president is expected to be questioned extensively on the administration's plans for Iraq. The market is also awaiting a key report by U.N. weapons inspector Hans Blix. White House officials said they will decide after Blix's report to the Security Council on Friday whether to call for a vote on a resolution authorizing the use of force against Iraq. Blix's report is expected to be a mixed bag, praising Iraq for its destruction of Al Samoud missiles but also saying that gaps remain in Iraqi cooperation. Supporters and opponents of war are likely to seize on the report to press their case as the showdown over Iraq comes to a head. Russia, France and Germany say they won't allow passage of a war resolution, while the United States and Britain insist time is running out for Iraq. "Until they know that it's going to happen or it ain't going to happen, the market's going to be choppy," said Bill O'Grady, an analyst at A. G. Edwards. At the New York Mercantile Exchange, the front-month April crude oil futures contract rose 31 cents to $37 a barrel but failed to breach key technical resistance at $37.20 a barrel. The May crude contract posted large gains, ending up 58 cents at $35.54 a barrel. The session's key feature was the tightening of the April-May crude futures spread, trader said. The spread narrowed to $1.46 from $1.95 Wednesday. Analysts said the selling reflected easing short-term concerns about supplies and the likelihood that a war in Iraq could be delayed in the face of growing opposition. "There is a realization that that there may be a little bit of relief in the short term," said John Kilduff, senior vice president for risk management at Fimat Futures Inc. Kilduff noted that the Department of Energy predicted that U.S. crude oil inventories, now standing at a quarter-century low, are likely to grow by more than 8 million barrels in March. Historically low inventories have helped boost oil prices in recent months. Inventories have been drained by a two-month strike in Venezuela and a cold snap in the Northeast. O'Grady said the market's focus on May and other deferred contracts may "handicap a delayed war or a realization that the sunshine scenario of oil prices tanking after a war in Iraq may not happen." Many industry analysts believe that oil prices could fall sharply if a war goes well for the United States. But O'Grady said prices would drop only if Bush decides to release oil from the nation's Strategic Petroleum Reserve. He said the White House can engineer a sharp fall in oil prices by releasing 25 million to 30 million barrels of oil from the reserve. Energy Secretary Spencer Abraham said Wednesday the SPR should not be used to "address prices," noting that the reserve was built only for "severe supply disruption." Prices earlier took a boost from rumors that Iraq had bombed its own oil fields. But Iraq's ambassador to Russia dismissed the report, according to the BBC. Meanwhile, heating oil futures rallied late in the session, drawing support from persistent cold weather in the Northeast and a decline in inventories. April heating oil rose 1.17 cent to $1.0556 a gallon. April gasoline futures gained .51 cent to close at $1.1060 a gallon. On London's International Petroleum Exchange, the gains were bigger. April Brent futures jumped 53 cents to close at $33.53 a barrel. Natural gas for April delivery fell 17.7 cents to settle at $6.844 per 1,000 cubic feet.

sg.biz.yahoo.com Friday March 7, 6:30 AM By Gaston F. Ceron Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)--U.S. stocks retreated among concerns about the economy and with the shadow of Iraq still hanging over the market.

Worries about corporate results continued to weigh on investors, who were faced with poor retail-sales reports and an earnings warning from Raytheon. Shares of Raytheon fell 5.5%.

The Dow Jones Industrial Average shed 101.61, or 1.31%, to end at 7673.99. The Nasdaq Composite Index fell 11.48, or 0.87%, to 1302.92. The Standard & Poor's 500-stock index dropped 7.75, or 0.93%, to 822.10.

Retail-sales figures for the month of February weren't encouraging, as stores were hampered by the big blizzard that hit the East Coast last month. Shares of Sears Roebuck fell 3.5%, while shares of May Department Stores dropped 2.2%.

Regarding the overall market environment, "after all is said and done, what this is all about is the economy and earnings," said Hugh Johnson, chief investment strategist at First Albany in Albany, N.Y. "And the outlook for the economy and earnings is deteriorating. Oil prices remain so high, and as a result the outlook for the economy is getting gloomier."

A worse-than-expected report on weekly jobless claims also spooked investors, suggesting that employment conditions are weakening, Johnson added. But the economic picture remains muddy, as data on productivity and factory orders painted a more positive picture.

The strategist noted that all the attention that has been given to the Iraqi situation may be masking other problems for the market. "The buzz on Wall Street is that if Iraq gets put behind us the stock market . . . will do well," he said.

But even if the Iraqi standoff is resolved, "there is still North Korea and terrorism, there is still Venezuela," Johnson said.

On the New York Stock Exchange, there were 1,226 issues advancing, 2,027 declining and 189 unchanged.

NYSE volume totaled 1,287,877,770 shares, compared with 1,302,704,190 Wednesday.

The NYSE Composite Index was 4626.02, down 47.73. The average price per share fell 21 cents.

Raytheon shares fell 1.49, or 5.5%, to 25.42. After the end of Wednesday's trading session, the Lexington, Mass., defense contractor confirmed its earlier expectations for 2003 earnings, but it also issued a 2004 profit forecast that was below what Wall Street had been expecting.

After being down as much as 5.7%, shares of Schering-Plough ended down 0.9%, or 15 cents, at 16.45. The Kenilworth, N.J., drug maker's stock was hurt by continued negative reaction to the company's lowered expectations for 2003 earnings, which were released during Wednesday's trading session. On Wednesday, Schering-Plough shares fell 3.1%.

Aegon fell 1.53, or 15%, to 8.42. The Dutch insurer said it will cut its dividend and reported a 35% drop in 2002 net income.

Shares of Tyson Foods shed 83 cents, or 9.7%, to 7.70. Late Wednesday, the Springdale, Ark., chicken and meat company said it expects to report break-even results from ongoing operations for the second fiscal quarter ending in March.

Retailers were hurt by poor sales reports for the month of February. Sears' domestic same-store sales fell by 9.4% from the previous year, a steeper decline than Wall Street had been expecting. Shares of the Hoffman Estates, Ill., company fell 70 cents to 19.30.

May Department Stores, parent of Lord & Taylor, saw its same-store sales fall 8.9% in February. Shares of the St. Louis company dropped 2.2%, or 41 cents, to 18.45.

Gap fared better. The San Francisco parent of Gap, Banana Republic and Old Navy reported an 8% increase in same-store sales, better than Wall Street had forecasted. Shares of Gap rose 33 cents, or 2.6%, to 13.18.

Michaels Stores, Irving, Texas, reported a 4% same-store sales decline. The company's shares dropped 43 cents, or 2%, to 21.37.

US Late Market Comment -5: Pfizer Gains On Patent Win

Pfizer and Pharmacia saw their stocks rise after the pharmaceutical companies - and merger partners - scored a victory, announced late Wednesday, in a patent dispute with the University of Rochester. The university is appealing.

Shares of New York-based Pfizer climbed 20 cents, or 0.7%, to 29.39. Pharmacia, Peapack, N.J., rose 16 cents, or 0.4%, to 40.71.

-By Gaston F. Ceron, Dow Jones Newswires; 201-938-5234; gaston.ceron@dowjones.com

sg.biz.yahoo.com Friday March 7, 6:29 AM

MEXICO CITY (Dow Jones)--Mexican Finance Minister Francisco Gil said Thursday that Mexico expects to earn 44.6 billion pesos ($1=MXN11.18) in additional oil revenue this year.

Crude oil prices, pushed up by expectations of war in Iraq and the recent strike in Venezuela, are giving the government additional breathing room in its austere budget for 2003.

Gil said that, based on an estimate of $30.50 a barrel for benchmark West Texas Intermediate, Mexico's export crude basket could be expected to average $23/bbl or $24/bbl during 2003, well above the $18.35 forecast used in this year's budget.

Mexico's crude averaged $27.88/bbl in January, and according to preliminary data, about $28.50/bbl in February. The budget is also based on a projected average export volume of 1.86 million barrels a day.

The Mexican government obtains about a third of its revenue from oil and oil-related fees and taxes.

Gil said at a meeting with tax authorities that petroleum-related income rose 70% in real terms during February from the same month last year.

Mexico reported a budget surplus of MXN9.7 billion in January, backed by an 18% increase in oil income.

Oil income will also be higher in peso terms as the Mexican currency weakens against the dollar.

The peso has mirrored dollar weakness against the euro, and has depreciated more than 18% in the past 12 months, due largely to Mexico's extensive trade and investment links with the U.S.

The recent rise in domestic interest rates, however, should increase the government's debt financing costs, Gil said.

Ministry Web site www.shcp.gob.mx

-By Santiago Perez, Dow Jones Newswires; (5255) 5080-3451; santiago.perez@dowjones.com

www.sfgate.com H. JOSEF HEBERT, Associated Press Writer Thursday, March 6, 2003
(03-06) 16:35 PST WASHINGTON (AP) --

Gasoline prices are expected to continue their upward climb and reach a record national average of $1.76 a gallon in April, the Energy Department forecast Thursday.

It predicted gas prices will average about $1.70 a gallon for regular brands through the summer driving season.

Gasoline prices have soared during the past month because of high crude oil costs, heavy demand for heating oil and tight inventories of crude as well as most petroleum products.

Already many parts of the country have been paying $2 or more at the pump. This week prices soared on the West Coast, where refining problems added to the price spike.

Gasoline prices increased to an average of $1.68 a gallon nationally this week, a hike of nearly 3 cents from last week and 54 cents higher than a year ago. Prices on the West Coast took the biggest jump, increasing by 8.5 cents to $1.93 a gallon, according to the Energy Information Administration.

"With the driving season beginning next month, pump prices are expected to continue to rise," said the EIA in a short-term energy forecast released Thursday.

The EIA said gasoline inventories remained tight, close to the lower end of the five-year average. This "is one of the reasons current pump prices are high," said the EIA, the department's statistical agency.

The $1.76 a gallon forecast for April would be a nickel more per gallon than the record high of $1.71 set in May 2001, said the agency.

These prices would still be somewhat of a bargain compared to gasoline costs in 1981 if inflation were taken into account, the EIA noted. Using today's dollar, motorists were paying the equivalent of $2.90 a gallon in March 1981, said the EIA.

The EIA said crude oil prices in February "moved higher than expected pushed by fears of war in Iraq, lower inventories (and) slow recovery of Venezuela's exports." The price of West Texas Intermediary, a benchmark crude, averaged $36 a barrel, a level not seen since October 1990, just months before the start of the Gulf War, the agency said.

Alluding to possible fighting in Iraq, the report said that "even without additional disruptions to world (oil) supply in the near term, prices are likely to remain on the high side and subject to substantial volatility through 2003."

Cold weather and tight supplies of both natural gas and heating oil caused residential heating bills to soar this winter.

The government estimated that if normal temperatures prevail through the end of this month, residential heating bills, compared with last year's cost, will be up by 30 percent for homes using natural gas, 60 percent for homes using oil, and 25 percent for homes using propane.

The cost of heating oil climbed to $1.83 cents a gallon this week, or 68 cents higher than a year ago, the government said. Propane increased to $1.72 a gallon, 60 cents more than a year ago. Natural gas prices have receded somewhat, but remained high.

On the Net:

Energy Information Administration: www.eia.doe.gov/

www.grandforks.com Posted on Thu, Mar. 06, 2003 BETH HARRIS Associated Press

ARCADIA, Calif. - Laffit Pincay Jr. broke a bone in his neck when he was thrown from his horse during a race and the injury could end the career of thoroughbred racing's winningest jockey.

Pincay was hurt last weekend at Santa Anita and will spend the next eight weeks in a cast, his son said Thursday.

"We expect a full recovery, and a decision on his career will be made at a future date," Laffit Pincay III said.

The 56-year-old Pincay was initially thought to have had muscle contusions to the back of his neck. He was expected to return to riding Friday and was booked on six mounts.

However, the injury is far more serious. Pincay III said his father will be fitted with a halo cast and leave a Los Angeles hospital in a day or so. He said his father was in good spirits.

The fractured bone is cervical 2, track spokesman Vince Bruun said. Cervical 2 is one of the uppermost seven vertebrae of the spine.

Pincay, who has more victories than any other jockey with 9,531, was thrown to the grass when his mount, Trampus Too, fell on the turn for home in the fifth race Saturday.

Jockey Tony Farina was suspended for seven days for altering course without sufficient clearance on Rainman's Request, which resulted in the spill that injured Pincay.

Pincay passed Bill Shoemaker's career record of 8,833 wins three years ago and has been determined to reach 10,000 victories despite his age.

"I have surprised myself that I'm still riding and competing the way I am," he said last summer, joking that he can't quit because his phobia about public speaking would preclude a retirement speech.

Pincay's 39-year career includes election to racing's Hall of Fame in 1975, a 1984 Kentucky Derby victory, three Belmont Stakes victories, five Eclipse Awards, and mounts on such great horses as Affirmed and John Henry.

The son of a famous rider in Panama and Venezuela, Pincay came to the United States at 17, speaking only Spanish and carrying a $500-a-month riding contract. He taught himself English by watching "Hollywood Squares" on TV.

He reached the winner's circle on his first U.S. mount, in 1966 at Chicago's Arlington Park.

Pincay's achievements haven't come without injury. He's broken his collarbone 11 times, broken 10 ribs, had two spinal fractures, two punctured lungs, two broken thumbs and a sprained ankle.

What's most remarkable about Pincay's longevity is his ability to control his weight.

Pincay has battled the scale since he was a teenager. Back then, he was told he was too big to be a jockey. He weighs 113 pounds and rides at 117 pounds, which includes his saddle and tack.

"He's built like a fighter, and the desire and ability he has, even today, is just unbelievable," Hall of Fame trainer Ron McAnally has said.

Pincay has said he'll keep riding as long as he enjoys himself. His only distraction outside the sport is his family, including second wife Jeanine and their 6-year-old son.

"I just love to ride horses. I love competition. I love the excitement of the game," he said in 1999. "I know it's a little dangerous and that's kind of exciting, too. You get hooked every day winning races. It makes you feel good."