Lack of dollars being felt throughout Venezuela
www.miami.com
Posted on Wed, Mar. 19, 2003
By MARIKA LYNCH
mlynch@herald.com
CARACAS - Jose Luis Rosal fell off the back of a pick-up truck, scraped his cheek, and needed 15 stitches in the crown of his head. Three days later, though, the 20-year-old waited seven hours outside a Caracas hospital for an X-ray to see if he had a skull fracture.
The hospital in his hometown, located an hour outside the capital, turned him away because they didn't have the materials to make an X-ray, his sister said.
Venezuela's chronically strapped hospitals have been further pinched since the government stopped selling U.S. dollars needed to import supplies, medicine and other goods.
The government imposed the currency controls two months ago, after a national strike that failed to oust President Hugo Chávez and all but shut down the oil industry -- the country's primary source of foreign exchange. With the national currency, the bolivar, dropping in value and fearing capital flight, the government imposed the controls to keep dollars in the country.
But since Venezuela relies on imports for most goods, imports bought with U.S. currency, the lack of dollars is being felt throughout the country.
Pharmacists say they have a stock for three more weeks, and then ''the Venezuelan health system could collapse,'' Edgar Salas Jimenez, president of the Venezuelan Pharmaceutical Association, said.
Manufacturers and distributors are running through inventory, but goods from toilet paper to electronics could become scarce, they warn. Meanwhile, farmers say their crops will be thinner this year, without the proper imported fertilizers. Then they'll have to scrounge for packaging material to wrap what is produced.
Big business, shopkeepers, and street sellers like Fortunata Humani, who sells bikinis and lace panties from a sidewalk stall, expect to be affected. Wholesalers already warned Humani their imported inventory is sparse. Humani, 46, says she may have to start sewing her own clothes from home, if she can find the material.
The Venezuelan economy, private analysts say, could shrink up to 30 percent this year, and the currency controls will be a factor.
''They are destroying the entrepreneurial fever of the Venezuelan people,'' economist Orlando Ochoa said of the controls. ``What little there is left.''
The effects also could reach Florida. Close to $3 billion in Venezuela-bound exports -- from machinery to medicines and clothing -- passed through Miami-Dade and Tampa's ports in 2001, according to business development group Enterprise Florida. Also, under the measure, Venezuelans aren't allowed to use credit cards abroad, which curtail shopping in South Florida malls. Business travelers will be allowed to get dollars, but only $1,000 a trip, allowed three times a year.
This week, the government said it will start selling $645 million a month, to go toward a list of priority goods, mostly foods and medicine. The government is also artificially setting their prices, to keep them down.
But a newly created government agency will decide who gets the greenbacks, and only a fraction will actually be given to private importers, said Jose Piñeda, head economist for the Venezuelan American Chamber of Commerce and Industry. The government will use some, he said, to import food and distribute it to the poor at markets, he said.
Venezuela has imposed currency controls twice in the past two decades, and both periods ended with high inflation, Piñeda said. This time, though, the economy has already been weakened by the two-month strike, and the effects could be worse.
Business leaders want a parallel dollars market, where they can buy currency at a higher rate than the established 1,600 bolivars to the dollar. So far the government has avoided the idea. Some businesses are already turning to the black market, where one dollar is sold for 2,800 bolivars.
Business leaders, most of whom are opposed to President Chávez, also fear the government currency agency will use its power to punish people who supported the country's strike. The worry isn't without warrant. Chávez has said that ''Not one dollar'' will go to the ''coup-plotters,'' his name for those who tried to force him out through the strike.
First elected in 1998, Chávez was briefly ousted by a coup last April. A coalition of union, oil and business leaders failed to push him out, or call new elections, through a strike that ended in February.
Venezuela's newspaper owners fear that newsprint will not get on the import list, for political reasons. Their newspapers have been highly critical of Chávez. Newsprint first appeared on the list for a day, then was quickly removed. But officials have since said it will be restored.
On average, local newspapers have enough in stock to keep printing through April and into May.
But if that doesn't come through, ''we're going to be the first country in the world without a newspaper,'' said Miguel Henrique Otero, publisher of the daily El Nacional.
Editorial Roundup
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The Associated Press
March 19, 2003
Excerpts from recent editorials in newspapers in the United States and abroad:
March 18
The San Diego Union-Tribune, on the risk of inaction in Iraq:
Now, war is not only unavoidable but, in our view, necessary. It is necessary both to eliminate Iraq's weapons of mass destruction and to preserve the credibility of the international order that set out to disarm Iraq in 1991. This task is made all the more urgent by the global war on terror.
Sept. 11, 2001, taught us the consequences of looking the other way when rogue governments give sanctuary to terrorists, as Iraq has done. We refer to the international order, rather than the United Nations, because the Security Council, at the critical moment of decision, surrendered its responsibility to enforce its own mandates.
French President Jacques Chirac's repeated vows to veto any enforcement resolution that authorized war effectively eviscerated the power and influence of the Security Council.
Sadly, the world body sits impotently on the sidelines as the United States, Britain and their allies prepare to impose the "serious consequences" promised by Security Council Resolution 1441. ...
In the face of Hussein's intransigence, it would have been far better for this conflict to be carried out under the auspices of a unified Security Council. But the council's abdication of its responsibility is surely no reason for the United States also to abandon its duty to disarm Iraq. With nearly 300,000 soldiers, sailors, airmen and Marines including many from San Diego County deployed in the region, the United States and its allies cannot back down. To retreat now would hand a strategic victory to Hussein and thereby make the future far less secure, not only for Iraq's neighbors but also for ourselves.
To shrink from this difficult mission would serve only to make the world a more dangerous place.
March 18
The Huntsville (Ala.) Times, on the failure of diplomacy in Iraq:
Diplomacy has failed, and most of what remains is to count down the hours until the shooting starts
The uncertainty, of one kind at least, is over. Speaking to a worldwide TV audience Monday night, President Bush told Saddam Hussein that the only way to avert an American attack on Iraq is for Saddam and his sons to leave the country within 48 hours.
Diplomacy has failed. It has failed to persuade Iraq to come clean about its weapons. It has failed to persuade a majority of the U.N. Security Council to back up a new resolution on Iraq. It has failed to persuade the world of the wisdom or necessity of launching preemptive wars against states that may threaten the safety of others.
All that remains is war, and that is quite a lot. The number of bad things that can happen once we attack Iraq is significant. Bush himself Monday night devoted a portion of his speech to warning Iraqi troops against using biological weapons against allied forces. He told Iraqi military commanders that they would have information instructing them how to surrender.
March 18
The Observer-Dispatch, Utica, N.Y., on March Madness controversies:
College basketball's March Madness is upon us, but sadly, it's the wrong type of madness. A rash of college sports scandals makes clear too many colleges and universities have lost perspective about what their academic mission is all about.
By bending rules and cutting corners in an all-out quest for victories, these schools tarnish their own images and that of college sports as a whole.
In a year when Syracuse University's basketball team - by playing well and competing fairly - has brought more excitement to the Carrier Dome than has been seen in years, elsewhere college basketball has been rocked with a rash of scandals.
Academically ineligible athletes. Fake grades in a course taught by a coach's son. Misuse of a telephone credit card by multiple members of one team. Continued hiring of coaches of questionable ethics. And, in St. Bonaventure's case, the loss of a university president because he allowed the school to admit a basketball player whose credentials consisted of a welding degree.
These episodes are embarrassing and shameful. Even in the year 2003, colleges are still considered a place in society where idealism and truth can and do run free.
March 18
The Daily Oklahoman, Oklahoma City, on oil:
War with Iraq figures to make an already tight world oil market even tighter.
... U.S. crude-oil supplies are stretched, partly because of the recent oil workers' strike in Venezuela, a major exporter, and fears of a war with Iraq.
Hate to say we told you so, but the prospect of gasoline selling for $2, $2.50 or even $3 a gallon, and the potential for even greater national energy calamities, makes us wish the Arctic National Wildlife Refuge was producing oil and natural gas.
Of course, that would've required some foresight a decade ago, some sense in Washington that at some critical juncture down the road it would be good to have domestic supplies available to temporarily offset the sudden, potentially catastrophic loss of oil from a major overseas supplier.
That's right: If policy-makers in 1993 had given the go-ahead, the refuge's oil and natural gas would be online now, and we wouldn't be sweating $3 gas or even greater risks now.
March 17
The Journal Star, Peoria, Ill., on Bush's education cuts:
As part of his budget, President Bush has proposed big changes in Head Start, the federal pre-school program, and substantial cuts in after-school and vocational education. After-school money would be reduced by 40 percent, and the Perkins Vocational and Technical Education program would be virtually wiped out to divert dollars to "No Child Left Behind."
While no one can plausibly deny that illiteracy is a huge problem, these proposals seem to be working against themselves. Head Start is one example. School readiness requires more than just knowing your ABCs. Sometimes it means doing health screenings so an inner ear infection or poor eyesight gets detected/treated early, before it snowballs into something much more crippling later on. Sometimes it's providing breakfast. Those who deal with at-risk children will tell you they don't feel much like reading when they're hungry.
Yet Education Secretary Rod Paige will say those represent the very "mission creep" - military lingo is applied even to the classroom these days - that has made Head Start vulnerable to intervention.
Problem is, teaching kids to read is labor-intensive. If there are two strategies that seem to work, they're time on task and individualized attention. Those don't come cheap.
March 17
The Times-Picayune, New Orleans, on squashing skeeters:
The West Nile virus' deadly sweep across the country put the bite on local governments, which had to spend extra money to kill mosquitoes that carry the disease.
With the virus present in all but six states, this spring and summer is likely to bring more of the same. That's why a House vote to provide $100 million in grants through the Centers for Disease Control is a timely response.
The measure, which was sponsored by a Louisiana lawmaker, Rep. Chris John, a Democrat from Crowley, recommends that the Bush administration provide $100 million for mosquito abatement this year. Local governments would be able to apply for up to $100,000 in grants if they can come up with a 50 percent match.
In Louisiana last year, 329 people had West Nile and 24 died. The epidemic cost $24 million in this state, including mosquito abatement and hospitalization.
West Nile is a national public health threat, and federal help is justified. Since 1999, when the virus appeared in this country, there have been 4,007 cases of human illness and 263 deaths, according to the CDC.
The Senate, which will take up this legislation soon, should follow the House lead and vote to approve it. Prevention is always the best and most cost effective health care strategy, and killing mosquitoes is the best way to prevent the West Nile virus from sickening and killing people.
March 16
Orlando (Fla.) Sentinel, on open government:
Together with beaches, oranges and the Everglades, open government belongs on a list of things to treasure about Florida.
For decades, Florida has been a national leader in ensuring citizens access to their government.
But in the ensuing 10 years, lawmakers made more than 100 exceptions. So last fall, voters weighed in again. By a 3-to-1 margin, they passed an amendment to require that exceptions be approved by two-thirds of the members in both houses of the Legislature, rather than majorities.
Yet many lawmakers still aren't listening. Government in the sunshine remains under siege in the Sunshine State.
With this year's legislative session less than two weeks old, lawmakers already have introduced at least 37 bills that could limit public access to government information.
Most insidious are more than a dozen "shell bills" that would allow exceptions to the constitution without including any details. Such bills are stealth weapons targeting the public's right to know.
Open government, by contrast, instills confidence among citizens. It invites them to participate. It leads to better decisions, as ideas are questioned, then refined.
Open government also promotes better use of tax dollars. It holds government accountable.
Yet Florida's legacy of open government won't be safe unless citizens demand that lawmakers honor it.
March 17
The Cincinnati Enquirer, on Christopher Reeve:
"Superman" Christopher Reeve may have more sheer power as a paralyzed hero than he ever had as a movie star. Reeve has become a symbol of hope and encouragement to hundreds of thousands of people who suffer from spinal cord or other paralyzing injuries and to all of us who know and love someone who does.
The 50-year-old actor was paralyzed from the neck down in a horseback riding accident in 1995. Through the media, people have tracked and cheered Reeve's quest to recover from his quadriplegic condition.
His latest triumph was reported last week. Doctors implanted electrodes in his chest to help him breathe through his nose, without a ventilator, for the first time in nearly eight years.
Reeve has become a "superman-like" advocate for medical research and funding through his Christopher Reeve Paralysis Foundation.
Meanwhile, Reeve's real-life journey of hope and determination is more powerful than any story Hollywood could manufacture.
March 18
Le Figaro, Paris, on war with Iraq:
In a few days, perhaps a few hours, weapons will speak...If the American President triumphs quickly in Baghdad, public opinion, as versatile as it is spontaneous, will view him differently. What then will one remember from the long months leading up to the military offensive?
Of course, the debate on the alleged legality, or illegality, of this war. Resolution 1441, adopted last November by the United Nations, demands disarmament of Iraq by weapons inspections. The resolution does not implicitly evoke war, nor does it call for the defeat of Saddam's regime. International law has only a relative value: it can do nothing against force...
The diplomatic duel between George Bush and Jacques Chirac will have been the other big subject. A battle of positions that would almost eclipse the fact that the common enemy was the dictator of Baghdad. From both sides of the Atlantic, the media had harsh words for each of the presidents. Bush the crusader, Bush the simple-minded, versus Chirac the traitor, Chirac the friend of Saddam...
Chirac's pacifism is no more absolute than Bush's bellicosity: without the September 11 attacks, the President of the United States undoubtedly would not have initiated a war.
March 18
Algemeen Dagblad, Rotterdam, on President Bush and war with Iraq:
In defiance of opposing views in his own country and everywhere else, Bush is religiously convinced war is the only remedy against the dictator of Baghdad. The theatrical negotiations in the U.N. security council, sharply waged, appear in retrospect to have had little meaning. It is disturbing that the U.N. only matters to Bush when it goes along with the plan-making in Washington, and is otherwise shoved aside as meaningless. This arrogant attitude, more than the conflict over how to disarm Saddam, explains the distance in large parts of the globe and the division in Europe. But Washington doesn't feel responsible for the consequences.
However sad this all is, it can't be seen as a big surprise. Ever since Bush became president after an unconvincing election result, he has been surrounded with advisers who can't be told anything by the outside world. The big question is what they will put on the agenda after Iraq: North Korea, Iran or other minor annoyances America wants to deal with.
March 18
Business Day, Johannesburg, on going to war with Iraq:
There is no reason not to wait a little longer for a war
(We cannot) live in a world where wars are lit by passion and hatred. Sometimes, humanity demands compromise and patience.
(Saddam) needs to be contained in the most comprehensive way. UN sanctions on Iraq should be tightened... And the UN weapons inspectors need to become a permanent fixture.
... Any government arguing, that Iraq must indeed disarm, but which does not also contribute to the pressure to disarm, is double-dealing. The US and Britain ... are the only nations actually forcing the disarmament required unanimously by the UN Security Council in Resolution 1441.
But the failure of diplomacy does not have to be final ... Many thousands of lives are at stake. Nothing is more important than that.
For diplomacy to work, however, the US and Britain need support. It is no good France and the rest of the Security Council idly opposing Bush, however crass his modus operandi may have been. The more united the pressure on Iraq, the longer war can be averted.
Saddam must go, yes. And his weapons too. But this week, this month, is too early for war. There are still stones left unturned. Wait a little and work on the French.
March 18
Egyptian Gazette, Cairo, on U.S.-Iraq:
Emerging from a hastily called summit on Iraq in the Azores Islands in Portugal, U.S. President George W. Bush told a jittery world that "a moment of truth" was at hand.
With all signs pointing to an inevitable war, which has no good rationale or moral grounds, the aftermath will be most likely horrible. One reason is that the battlefield is an already volatile region. Another is these pervasive feelings of vulnerability across the globe. These feelings are bound to deepen.
If a moment of truth is already at hand, it is Mr. Bush who needs to grasp it and be cognizant of the fact that his unjustified war would open the Pandora's box for the whole globe.
March 18
Jordan Times, Amman, on U.S. plans in Iraq:
As the U.S. goes to war, Jordanians and Arabs find themselves haunted by the same question that they have been asking Washington for the past few months: What is the plan?
Speaking after the Azores summit on Sunday, President George W. Bush reiterated his commitment to a 'unified' Iraq. That was - like 95 percent of what Bush, British Prime Minister Tony Blair and Spanish Prime Minister Jose Maria Aznar said after their summit - nothing new.
What Bush has failed to mention so far is how he intends to keep Iraq united, how he intends to foster the emergence of a representative administration, including all ethnic and religious components of Iraq society.
The major question is how?
There have been insistent talk of a U.S. occupation and U.S. military administration. But beyond sheer propaganda on the 'liberation' of Iraq and some nebulous democratization process, we have heard nothing from Bush about an actual Iraqi government.
Alternatives to the regime of President Saddam Hussein have yet to be spelled out.
No Jordanian, no Arab has ever bought, even for one single second, Bush's blabbering about bringing democracy to the region.
A democratic government in Baghdad would reflect people's anger and revulsion against U.S. policies, and translate it into policies.
March 18
The Daily Telegraph, London, on the U.N. backing the war with Iraq :
The argument today should not turn on the precise role of the United Nations in the move to war. Despite Robin Cook's eloquent assertions last night, it is not true that a second U.N. resolution is essential under international law. Several wars since 1945 have been fought legitimately with far less U.N. backing than this one. The role of the U.N. should now be to work to build the new Iraq that will follow the fall of Saddam. ... Ours is the only European country in the postwar era which has never shirked its obligation to try to preserve peace in the world and defend the interests of the West against its enemies. If we slink away now, we will suffer much more than the relatively minor catastrophe of losing a prime minister: we will be weak and friendless, and we ought to be ashamed.
March 19
Singapore's Straits Times, on So war it shall be:
It is just as well no second resolution was presented, as defeat would have placed the U.S.-led coalition in defiance of international will if it proceeded to invade Iraq regardless.
It is possible the war will be so one-sided and over so quickly the nay-sayers will be forced to shut up, and all is quickly forgotten. With America's superior arms, it is possible. It does not seem probable, however.
The bitter fights at the Security Council have cut deep. They were not about French pique and American muscle, but eventually were about the sanctity of the U.N.'s assigned role to hold the peace among nations. Consensual decision-making is a vital part of that process.
A weakened U.N. is not in any country's interest, including America's. Now that war is a fait accompli, the U.N. owes it to itself to assert its authority in Iraq's post-war reconstruction phase and the treatment of refugees and prisoners of war. The U.S. should play its part in restoring the world body's battered prestige.
March 18
Asahi Shimbun, Tokyo, on Iraq war:
Regardless of the U.N. position, the United States has the strength to act alone. It is, after all, U.S. President George W. Bush's war.
"The international community is already divided. Anti-American sentiment has grown in the Arab world and is likely to destabilize governments traditionally friendly to the United States. Even if democracy is brought to Iraq, as the United States anticipates, it does not necessarily follow that a new government brought into being in Iraq through elections would be friendly to the United States.
Bush characterizes war in Iraq as part of the war on terrorism. But there is a danger it will increase terrorism instead.
Although there is no United Nations approval for war and no satisfactory plan for what Iraq will be like after Saddam Hussein, the world seems to be unable to stop the inexorable march to war.
March 19
Dagsavisen, Oslo, Norway, on the United States' illegal war:
The United States will go to war with Iraq without a U.N. mandate and without itself under direct threat.
While everyone says the war is preventative, it's an aggressive war, which as defined by the War Crimes Tribunal in Nuremberg, Germany, at the end of World War II, is a war crime itself.
We are therefore happy that Prime Minister Kjell Magne Bondevik has stated that Norway cannot and will not support the attack on Iraq.
The United Nations has always been a cornerstone of Norwegian policy and there's no reason to change that just because the United States did not get its way with the U.N. Security Council.
President Bush cites Iraq for helping terrorists as a reason for war. The stance has been repeated so often that most Americans believe it.
Yet a bluff repeated often repeated does not make it true, and the Americans have never proven the link.
President Bush has long prepared for war, but he never thought he would get so little support or negative world opinion.
That's because the Bush administration's reasoning for war doesn't hold water. Suspicion of evil intentions isn't enough.
Analysis: Is the war all about oil?-I
Posted by click at 8:48 PM
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oil
www.upi.com
By Sam Vaknin
UPI Senior Business Correspondent
From the Business & Economics Desk
Published 3/19/2003 2:22 PM
SKOPJE, Macedonia, March 19 (UPI) -- If the looming war was all about oil, Iraq would be invaded by the European Union, or Japan -- whose dependence on Middle Eastern oil is far greater than that of the United States. The United States would probably have taken over Venezuela, a much larger and proximate supplier with its own emerging tyrant to boot.
At any rate, the United Sates refrained from occupying Iraq when it easily could have, in 1991. Why the current American determination to conquer the desert country and subject it to direct rule, at least initially?
There is another explanation, insist keen-eyed analysts.
Sept. 11 shredded the American sense of invulnerability. That the hijackers were all citizens of ostensible allies -- such as Egypt and Saudi Arabia -- exposed the tenuous and ephemeral status of U.S. forces in the Gulf. So, is the war about transporting American military presence from increasingly hostile Saudis to soon-to-be subjugated Iraqis?
But this is a tautology. If America's reliance on Middle Eastern oil is non-existent, why would it want to risk lives and squander resources in the region at all? Why would it drive up the price of oil it consumes with its belligerent talk and coalition-building? Why would it fritter away the unprecedented up-swell of goodwill that followed the atrocities in September 2001?
Back to oil. According to British Petroleum's Statistical Review of World Energy 2002, the United States voraciously -- and wastefully -- consumes one of every four barrels extracted worldwide. It imports about three-fifths of its needs. In less than 11 years' time, its reserves depleted, it will be forced to import all of its soaring requirements.
Middle Eastern oil accounts for one-quarter of U.S. imports, Iraqi crude for less than one-tenth. A back of the envelope calculation reveals that Iraq quenches less than 6 percent of America's Black Gold cravings.
Compared with Canada (15 percent of American oil imports), or Mexico (12 percent) Iraq is a minor supplier. Furthermore, the current oil production of the United States is merely 23 percent of its 1985 peak -- about 2.4 million barrels per day, a 50-year nadir.
During the first 11 months of 2002, the United States imported an average of 9,000 bpd from Iraq. In January 2003, with Venezuela in disarray, approximately 1.2 million bpd of Iraqi oil went to the Americas, up from 910,000 bpd in December 2002 and 515,000 bpd in November.
It would seem that $200 billion -- the costs of war and post-bellum reconstruction -- would be better spent on America's domestic oil industry. Securing the flow of Iraqi crude is simply too insignificant to warrant such an exertion.
Much is made of Iraq's known oil reserves, pegged by the U.S. Department of Energy at 112 billion barrels, or five times the United States' -- not to mention its 110 trillion cubic feet of natural gas.
Even at 3 million bpd -- said to be the realistically immediate target of the occupying forces and almost 50 percent above the current level -- this subterranean stash stands to last for more than a century.
Add to that the proven reserves of its neighbors -- Kuwait, Saudi Arabia, the United Arab Emirates -- and there is no question that the oil industries of these countries will far outlive their competitors'. Couldn't this be what the rapacious Americans are after? -- wonder genteel French and Russian oilmen.
After all, British and American companies controlled three-quarters of Iraq's mineral wealth until 1972 when nationalization denuded them.
Alas, this "explanation" equally deflates upon closer inspection. Known -- or imagined -- reserves require investments in exploration, development and drilling. Nine-tenths of Iraq's soil is unexplored, including up to 100 billion barrels of deep oil-bearing formations located mainly in the vast western Desert. Of the 73 fields discovered, only 15 have been developed.
Iraqi Oil Minister Amir Rashid admitted in early 2002 that only 24 Iraqi oil fields were producing.
The country has almost no deep wells, unlike Iran, where they abound. The cost of production is around $1.00 to $1.50 per barrel, one-tenth the cost elsewhere.
Texas boasts 1 million drilled wells, Iraq barely has 2,000.
The Department of Energy's report about Iraq concludes: "Iraq generally has not had access to the latest, state-of-the-art oil industry technology (i.e., 3D seismic surveys), sufficient spare parts, and investment in general throughout most of the 1990s."
It has reportedly been utilizing questionable engineering techniques such as over-pumping, water injection and old technology to maintain production.
The quality of Iraqi oil deteriorated considerably in the past decade. Its average American Petroleum Institute gravity declined by more than 10 percent, its water cut (intrusion of water into oil reservoirs) increased and its sulfur content shot up by one-third. Iraq's oilfields date back to the 1920s and 1930s and were subjected to abusive methods of extraction. Thus, if torched during a Gotterdammerung, they might well be abandoned altogether.
According to a report published by the United Nations two years ago, Iraqi oil production is poised to fall off a cliff unless billions are invested in addressing technical and infrastructure problems. Even chaotic Iraq forks out $1.2 billion annually on repairing oil facilities.
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Part 2 of this analysis will run Thursday. Send your comments to svaknin@upi.com