URL Reuters, 03.27.03, 2:18 AM ET

SINGAPORE, March 27 (Reuters) - Oil prices rose two percent on Thursday, boosted by possible prolonged supply stoppages from Iraq, as U.S.-led forces try to oust Saddam Hussein, and Nigeria where civil unrest has cut crude output by 40 percent. Data showing a fall in U.S. gasoline stocks, at a time when refiners are normally scrambling to build inventory, pushed U.S. gasoline prices sharply higher with traders fretting over the chances of a supply crunch during peak demand in the summer. At 0701 GMT, U.S. light crude was up 64 cents at $29.27 a barrel. London's Brent crude was 48 cents higher at $25.77 a barrel. "OECD stocks are relatively low and that's a bit of a worry. Things are tight. The market is probably getting a little nervous ahead of summer driving season. The United States really needs sweet Nigerian crude to crack into gasoline," said David Thurtell, commodities strategist at Commonwealth Bank in Sydney. Nigerian crudes produce a high yield of gasoline when refined, ideal for U.S. refiners which should be cranking up gasoline output ahead of the peak-demand summer vacation season. Bloody clashes between warring tribal factions in Nigeria's oil-rich Niger Delta have shut down 800,000 barrels per day (bpd) of output from Africa's biggest producer. Ethnic leaders had agreed to a ceasefire which should allow foreign multinationals, including Royal Dutch/Shell and ChevronTexaco, to return to the country and restore normal output of 2.2 million bpd, local officials said on Wednesday. Nigeria is a major oil exporter to the United States and sent more than 560,000 bpd last year to the world's biggest oil consumer. Energy Information Administration data on Wednesday showed U.S. gasoline tanks declined 2.1 million barrels in the week to March 21 to 199 million barrels, down 16 million barrels from a year earlier. U.S. unleaded gasoline futures made strong gains of 1.58 cents to 94 cents a gallon. An anti-government oil workers' strike in Venezuela had also cut into U.S. gasoline supplies and U.S. refiners were unable to step up gasoline production as much as normal as they worked to meet heating fuel demand during a cold northern winter. The EIA reported a 3.7 million rise in U.S. crude inventories to almost 274 million barrels, above the 270 million mark that U.S. government considers a minimum to keep the nation's refineries operating smoothly, but 56 million barrels below a year earlier. The OPEC producers' cartel has said it will fill any supply disruption due to the Iraq war or the Nigeria clashes, although its crude is not an ideal replacement for the Nigerian grade. WAR ROLLS ON Iraq's oil exports, about 1.8 million bpd before the U.S. launched its invasion on March 20, have come to a standstill. But supplies from other Middle East producers, accounting for 40 percent of world trade, have been running smoothly. Kuwait had shut some oil wells near the Iraqi border at the start of hostilities but restoring some production on Wednesday. Saudi Arabia, Kuwait, Iran, Qatar and the United Arab Emirates ship about 15 million bpd through the Gulf. Fears Iraq might destroy oilfields in a replay of the massive damage inflicted by retreating Iraqi troops in the 1991 Gulf War have not materialised. Iraq's southern Rumaila oilfields, which account for about 60 percent of its 2.5 million bpd production, have been secured by U.S. and British forces with little damage to infrastructure. Kuwaiti officials have said that any remaining wellhead fires in the Rumaila field could be out in three to seven days. U.S. warplanes have been pounding frontline Iraqi positions about 35 km (20 miles) east of the northern oil city of Kirkuk, where oil wells can pump up to 900,000 bpd. Meanwhile, about 1,000 U.S. paratroopers prepared a new front in the north. U.S. President George W. Bush warned on Wednesday against expectations for a quick victory, saying "the war is far from over". U.S. forces have met increasing resistance from Iraqi troops as they have drawn closer to Baghdad in the last few days.

URLMarch 27, 2003 Last updated 10:34 AM Mar. 27

For truck driver Tom Test, runaway diesel fuel prices have reached the speed of lunch.

Earlier this month, the Norfolk resident pulled into a Massachusetts truck stop for a quick bite and a fillup.

The cost of diesel, according to the sign out front, was $1.96 a gallon.

One burger and about half an hour later, he drove back around from the restaurant to the pumps.

The new price: $2.01.

It was the same . . . stuff they had 30 minutes ago,'' Test said. It made the hair on the back of my neck stand up.''

Diesel prices are up one-third in the past year -- an even sharper jump than gasoline -- due to costlier crude oil and instability in the Persian Gulf.

And the increase is pounding motor carriers, especially small owner-operators like Test, for whom fuel is the biggest single piece of operating costs.

You tighten your belt up and do the best you can,'' he said. But your bottom line just plummets.''

Around Hampton Roads, diesel now averages about $1.81 a gallon, according to AAA.

While that's off slightly from the $1.82 local record set two weeks ago, the price is 39 percent higher than last year at this time.

Nationwide, diesel prices are also off from the new average high of $1.77 reached earlier this month, although they are still up 30 percent from a year ago.

Prices on the East Coast typically run higher than the national average, which includes cheaper areas such as the Southeast, the Midwest and the Gulf Coast.

The recent prices are not adjusted for inflation; in current dollars, fuel costs were well over $2 per gallon in the early 1980s.

Analysts cite several factors for the increase.

A work stoppage in Venezuela in December and January crippled that country's production of crude oil, from which gasoline, diesel and other petroleum goods are made.

Although the strike ended Feb. 1, production by the No. 4 supplier of crude to the United States has not caught back up.

Civil unrest in Nigeria, the fifth-largest supplier of U.S. crude, has also reduced oil output.

As a result, domestic crude oil stocks are down more than one-sixth from a year ago, at 270.2 million barrels.

Predictably, unrest in the Middle East has also driven up prices.

While the weeklong interruption of oil from Iraq has created no supply problems yet, speculation by fuel traders drove up some crude prices as high as $38 a barrel this month -- more than half-again as high as a year earlier -- on fears that a protracted war could cut oil output in the region.

And an unusually cold winter meant more domestic refiners continued making fuel oils rather than changing over to producing gasoline or diesel.

The explanation offers little comfort to the trucking companies that need diesel to survive.

Fuel comprises up to 30 percent of operating expenses for trucking companies, according to American Trucking Associations, an Alexandria-based trade group. Diesel is the second-largest cost after labor.

The industry has paid more than $1 billion in additional fuel costs this year compared to the first quarter of 2002, ATA said.

With inflation under control, the impact on the price of goods is difficult to gauge. Outside of volatile food and energy costs, the consumer price index climbed just .1 percent in February, the federal government reported, capping the smallest 12-month gain in nearly four decades.

Nonetheless, for motor carriers, the sharp jolt in a major cost like fuel can be devastating.

The association estimates that every 10-cent increase in the price of diesel drives 1,000 motor carriers out of business.

And that only includes fleets with five trucks or more; thousands of smaller carriers are also jeopardized by rising prices.

The organization estimates that more than three-fourths of the nation's 600,000 trucking companies operate six or fewer vehicles.

``It's become a crisis,'' said ATA economist Diego Saltes.

Bigger trucking companies can buy fuel at higher volumes than individuals, for instance, and spread out fixed costs over numerous vehicles. The economies of scale allow them, they say, to scrape by with some profits.

Many can also charge more when their costs go up.

Bay West Transport in Chesapeake adjusts the rates for its 60-truck fleet daily, to stay current with the expense of the 20,000 or so gallons of diesel it burns each month.

The company's charge per mile is running about $1.30 now vs. about $1.10 late last year, with no business lost to date.

We had to do that,'' said owner Mason Bailey. This fuel thing is a great spike in our costs.''

The strategy doesn't always work.

Baltimore-based O.S.T. Trucking Co. Inc. has instituted a 9.5 percent surcharge to cover fuel.

That does not offset costs that have risen more than triple that rate in a year, however.

``We can recoup part of it, but not all of it,'' said Bill Mayes, manager of the company's Virginia Beach terminal.

For independent truck owner-operators, who have to cover their own costs from maintenance and insurance to fuel, the bite is even harder.

As the industry has become more corporate and independents have scrambled for work, many are hesitant to raise prices too much for fear of losing jobs. Profit margins are evaporating.

The ATA says many drivers are simply parking their trucks, and even putting them up for sale, because they are not generating the income to survive.

Test -- who hauls under contract for Ram Transport of Virginia Beach -- says that with a $1,000-a-month payment on his 1998 Freightliner, he cannot afford to stop driving.

A 12-cent-per-mile fuel surcharge levied by Ram and passed along to Test helps: With fuel economy of six miles per gallon in the truck, he's actually up about 3.5 cents a mile from a year ago, based on Norfolk prices.

But every time he fills up in a big city in the Midwest or Northeast, where diesel can be 20 cents a gallon higher, that advantage is gone.

Test admits he is resigned to waiting for the fuel price runup to ease.

You just have to ride the storm out,'' he said. That's all you can do.''

And the outlook is mixed. Crude prices continue to whipsaw hourly between $27 and more than $30 a barrel on war news.

Reach Michael Davis at 446-2599 or midavis@pilotonline.com

EDITORIAL • March 27, 2003      Venezuela struck a curiously magnanimous tone in recent days, promising to be a reliable wartime supplier of oil. "We are and will continue to be the most secure supplier of oil to the United States," said Venezuela's Vice President Jose Vicente Rangel last week, as the United States appeared on the brink of war with Iraq.      Surely, any pledge of goodwill from Venezuela towards the United States raises eyebrows these days, given the recent testy exchanges between the two countries. But, despite the tensions, Venezuela could hardly be expected to punish itself economically by halting oil exports to the United States.      Venezuela has traditionally provided about 20 percent of America's crude-oil imports, and it is the world's largest oil producer outside of the Middle East. In the wake of a two-month nationwide strike that began Dec. 4, Venezuela's oil production has been impaired. About 40 percent of the workers at Venezuela's state oil company were fired for striking. Before the strike, Venezuela was exporting about 2.5 million barrels a day, of which 1.5 million (60 percent) went to the United States. Estimates vary on what Venezuela is currently exporting.      Some private analysts believe Venezuela is exporting 1.8 million barrels a day and producing 2.4 million barrels a day. The government says it has passed its OPEC production quota of 2.8 million barrels a day, and can even push up production to 4 million barrels by April, if there's a supply emergency.      Regardless of the varying estimates, the company's ability to recover from the strike is impressive. And the United States does indeed need Venezuelan oil, particularly now. The Bush administration has successfully balanced its need for Venezuelan oil with its determination to hold Mr. Chavez accountable for his actions. The administration criticized Venezuela's arrests of strikers, for example, to which Mr. Chavez responded by telling the United States to mind its own business.      Now, with some Iraqi oil wells set on fire and the war possibly disrupting oil production for an unknown period of time, it may be tempting for the United States to go silent on its concerns about Mr. Chavez. But a continuation of the Bush administration's calibrated policy would bolster U.S. credibility and leadership. Also, the engagement of the United States and other countries in the Group of Friends initiative — an effort to broker agreements between the government and the opposition — keeps Mr. Chavez's policies within certain democratic bounds. The Group of Friends may also be moderating the opposition's tactics. A more restrained Mr. Chavez helps avert the kind of crisis that would disrupt Venezuela's oil production over the medium or long term.      The best guarantor of stability and oil production in Venezuela will be the international community's steady engagement. At this point, the whole world has a stake in Venezuela's future.

<a href=www.sun-sentinel.com>URL Published March 27, 2003

PHOENIX -- Francisco Rodriguez stands tall, tucks his glove over his heart, looks in for the sign and prepares to make his pitch.

Only that's not a baseball in his right hand, it's a two-liter bottle of Pepsi. And this isn't the pitcher's mound at Edison International Field but a cavernous sound studio of high wood beams and cold concrete floors.

A hard midafternoon rain is falling outside, but the man-child who helped pitch the Anaheim Angels to their first World Series title can't hope for a rainout to spring him from this assignment.

K-Rod is stuck here for the next four hours shilling for a soft-drink company that is paying him handsomely for the right to slap his image on cans and cardboard cutouts from Southern California to his native Caracas, Venezuela.

This is just one of the endorsement deals Rodriguez, 21, has signed in the wake of his staggering rise to prominence last October. There's also a two-year contract with Nike, and his marketing representative, Scott Becher of Miami Beach-based Sports & Sponsorships, is still sifting through numerous other offers.

"His appeal is so special for somebody his age," Becher says during a break. "Frankie has the poise of a veteran. He's very comfortable with himself."

On the field, that much is obvious. Here, however, nothing comes naturally, especially with his two young daughters crying in the next room, but K-Rod gamely fights on.

He stands before a bright green background, clutches the big bottle of fizz, turns on his megawatt smile and tries to concentrate. Speaking in Spanish, he repeatedly invites potential viewers to "look for the Pepsi promotion at a store near you."

Three takes go by, then six, then a dozen. The kid who turned the World Series on its ear is growing frustrated.

"Lots of excitement, K-Rod," the director says. "Big smile, now. This is exciting!"

Finally, on Take No. 19, everybody is happy. Rodriguez then moves on to the English-language spot and nails it in two takes.

Ninety minutes of still photos follow.

"That was boring, man," Rodriguez says a few days later at Angels camp. "It was, `Stand up, do this, do that, go over here, stand right there, put your arm like this. Smile, don't smile.' Damn."

Endorsement work may bore K-Rod, but he is nothing short of fascinating when it comes to his primary profession. As compelling as Rodriguez's story was last season, when he began the year at Double-A Arkansas and wound up blowing away Barry Bonds on the sport's ultimate stage, he bears even greater attention now.

He remains a rookie, for starters, thanks to the technicality that landed him on the postseason roster with just two weeks of big-league experience. What's more, the baseball world will be watching to see if this former bonus baby with the high-90s fastball can keep his roll going or if he'll fade into the pack.

No one with the Angels is expecting any backsliding.

"He's got things in the proper perspective," Angels General Manager Bill Stoneman says. "He understands you've got to prove yourself. He's more mature than his age. That's what we've got here."

Rodriguez spent the winter in his troubled Venezuela but didn't go out much for fear of being robbed or worse. The political strife kept him from seeing his fiancee, Andrea Harvey, or their two daughters for more than one week all winter, but their bond is clear on that rainy afternoon in Phoenix.

When Rodriguez is able to break away between sessions, 2-year-old Adriana runs up to her Papi with a hug. Destiny, born last May while her daddy was pitching in Little Rock, watches the proceedings intently between afternoon feedings.

"It's kind of funny how everybody wants to do something with him now," Harvey says. "A year ago, they could care less."

They met three years ago at minor league spring training but didn't start dating until he was pitching during the 2000 season for Class A Lake Elsinore in the California desert. Harvey, the daughter of a Southern California police officer, was best friends with the wife of Rodriguez's roommate, Nelson Castro, but it wasn't love at first sight.

"I knew [Rodriguez] was young, and I knew he had signed for something [$950,000] because he was kind of, like, macho and driving around in his white Mustang convertible," she says, smiling. "He had his friends in the back and he was just screeching all over the place. I just thought he was some young kid that was just, like, a troublemaker, really."

A double date at a dance club helped change that perception, and soon they became inseparable, the cop's little girl and the baseball prodigy from Venezuela.

"He used to tell me all the time he was going to send me to jail," says Harvey, who at 23 is two years older. "I told him, `You're over 18.'"

He helped her learn Spanish, which she speaks constantly to their daughters. She helped him with his English, which he has picked up remarkably well, although he remains self-conscious, especially around strangers.

"He knows perfect [English]," she says. "Sometimes he doesn't think he knows something and he doesn't want people to laugh at him. He doesn't want to be embarrassed."

When the Angels were having trouble reaching Rodriguez during the offseason, they went through Harvey. She would track him down through friends or family and could relay messages back to the Angels, often within an hour or two.

When visas were scarce, there was talk of using a Canadian work visa or sending Rodriguez through the Dominican Republic on his way to spring training. Eventually he was able to land on these shores the conventional way, thanks to Harvey letting him know he needed to get to the U.S. embassy in Caracas.

She's a good influence on him, everybody says. Helps keep him grounded. Helps keep the K-Rod part of his personality from forcing plain old Francisco clear out of the picture.

"It's been kind of crazy for both of us," she says. "I'm not used to being in the spotlight. It's funny, you'll see people that didn't want to go to his games when he was in the minor leagues. Now, all of a sudden, he's such a good guy and they want to go see him."

Nobody's laughing at K-Rod now.

Mike Berardino can be reached at mberardino@sun-sentinel.com.

URL by Sharon Albright March 26, 2003

The campus community may be torn with how to feel about the war in Iraq, but it is united in that everyone will be impacted by it.

Along with the concern of oil supplies, there are countless other areas of uncertainty right now, one of which is the job market.

From an economic standpoint, there is a great deal of good news and bad news, according to Jim Palmieri, associate professor of economics. The good news is that gas prices are not expected to rise for the time being.

"If the conflict stays strictly in Iraq, the impact on gas prices here will be fairly minimal-short in terms of length of time-overall," Palmieri said.

The reason for this, Palmieri says, it that the United States relies on many countries for its oil supplies, including Venezuela, Mexico and Saudi Arabia; and there is not a heavier focus on the Middle East for this commodity. But, this is not the case for all nations.

"A lot of Europeans, the French, for example, have a much greater financial interest in Iraq than we have," Palmieri said.

Along with gas prices, the job market is not expected to change very much, according to Palmieri, which is not necessarily good news for job-seeking students.

"It's a tough job market right now," Palmieri said. "Technically, we're not in a recession, but we have very slow growth with unemployment ticking upward."

Palmieri said that the economic situation is a continuation of what started to happen even before the attacks of Sept. 11, 2001.

"I think the biggest thing that has been dragging the economy down is just the uncertainty of things, in the sense that people don't know what's going to happen in Iraq and overseas, so they hold back on spending," Palmieri said. "Markets don't like instability or unpredictability, because when consumers worry, that's difficult for the economy, especially one like ours where two-thirds of our economy is based on consumer spending."

Still, Palmieri said, the national budget remains strong enough that it should not be heavily hit by the additional military expenditures involved in this war.

"WWII had massive impacts on the U.S. economy, both in terms of output and employment," he said. "This war in Iraq is not going to have that same level of impact on output or employment. It's not nearly as big, relative to the size of the economy."

"We have an economy of around $10 trillion," Palmieri said. "So, let's say we spend $40 or $50 billion on this, which is a lot. However, it's not nearly as much as what we did in WWII-relative to the total budget and output."

Spiritual responses

Talk of the war in Iraq carries over from classroom discussions into student's personal conversations and daily lives.

The chapel staff is still in the process of forming ways to be of service to the Simpson community during this time, according to Chaplain Chris Waddle.

"Honestly, we put a lot of our energy into pre-war issues, so now we're left reeling on how to take action now that the war is here," said Waddle. "We're still organizing how to react to this as a pastoral issue and also as a human issue in general, since not everyone shares the same beliefs."

Soon after the fighting in Iraq started, the chapel took its first step with an inter-faith candlelight vigil. Waddle said that it was important to offer this opportunity for students to reflect. Since then, it has opened up a letter writing campaign for students to communicate with soldiers stationed overseas.

"Faith-wise, I think this is a troubling time for a lot of students who are wrestling with how to support our people in the military, when they don't support the war. At the same time, there are others who support the war who feel like they are in the minority."

Waddle said that the way for students to work through this separation in beliefs is to remember that no matter exactly where we stand on our beliefs, we can be united in our opposition to death and destruction.

Diverse reactions

International students on campus seem to stand by Waddle's analysis. Junior Fungasai Nota said that he is opposed to any type of war, and he relates his pacifist position to growing up outside of America. Nota said that the Iraqis, for the most part, are already living in impoverished conditions, which is saddening enough without the added damage of war.

"There is enough human suffering without bringing war into it," Nota said. "When you live around poverty and see the suffering that comes from it, you can't justify adding to it by bringing war into the picture," Nota said.

Another international student differs slightly in her interpretation of the conflict. While junior Ivy Zhang also sides against the war, she comprehends America's reasons for taking action at this time.

"I totally understand President Bush's reasons for saying that it was necessary to take action," Zhang said. "From being here during Sept. 11, I can see how Americans have a great interest in seeing that something like that does not happen again."