Reuters, 04.01.03, 3:35 PM ET By Susan Schneider NEW YORK, April 1 (Reuters) - Brazil's sovereign bonds charged higher on Tuesday, building on the first quarter's heady 20 percent return, as the new president's pledges to overhaul the tax and pension systems enticed investors hunting for high yields. Brazil's share of J.P. Morgan's Emerging Market Bond Index Plus jumped 2.04 percent on the day, underpinned by a sharp 2.0 point gain in the benchmark C bond <BRAZILC=RR> to 81.0 bid. Brazil's spreads over comparable U.S. Treasuries -- the premium investors demand to compensate for risk -- narrowed 51 basis points to 997, or 9.97 percentage points. The last time Brazilian spreads closed below 1,000 basis points was on May 31, 2002, according to the EMBI-Plus. Investors have poured a steady stream of funds into Brazilian bonds in recent weeks on optimism that President Luiz Inacio Lula da Silva can patch together Congressional approval for the key reforms, which are seen as crucial if Latin America's largest economy wants to improve its fiscal health. "At this point, Brazil is one of the few places where investors can find high yields in fixed income," said Ricardo Amorim, head of Latin American research at research firm IDEAGlobal. " A continued rally "will basically depend on how well the reforms go. If Lula is able to approve the social security reform in coming months, I would expect to see the EMBI-Plus for Brazil going below 700 (basis points)," said Amorim. Lula once struck fear in the hearts of investors because of his political inexperience and his talk of debt renegotiation in previous political campaigns. The Lula angst helped Brazilian bond spreads balloon to a massive 24 percentage points over U.S. Treasuries last year. The union boss-turned-president, who took office at the turn of the year, has since won over Wall Street with respected cabinet appointments, promises to keep a tight lid on spending and the reform pledges. Lula said last week he would send Congress the social security and tax overhauls this month. Brazil's bonds have also benefited from the momentum of last week's Inter-American Development Bank meeting of investors and officials in Milan, said traders. "People are coming back from the conference bulled up on optimism over Brazil," said an emerging debt trader. Brazil's neighbors also made rosy showings on Tuesday. Venezuela's share of the EMBI-Plus increased 1.65 percent on the day, while Ecuador added 1.81 percent. Oil prices, sizzling on concerns the U.S.-led invasion of Iraq will cause crude supply disruptions, have aided the bonds of both oil-producing nations, said analysts. The broader index, meanwhile, added 0.74 percent in terms of daily returns. POWELL VISIT PULLS TURKEY HIGHER Turkish bonds hovered steady after U.S. Secretary of State Colin Powell said late Monday he would visit Turkey on Wednesday, a trip that buoyed hopes the two nations can improve their strained relations. A U.S. official requesting anonymity called it a "kiss and make up" visit. Turkey's share of the EMBI-Plus was little changed on the day and the benchmark 2030 dollar bond <TRGLB30=RR> traded flat at 87.875 percent of face value. Turkish-U.S. relations hit a rough patch after Turkey refused to allow Iraq-bound U.S. ground troops to use its territory. The move killed a U.S. offer of some $30 billion in aid and loans to Turkey, which needs the cash to shield its fragile economy from the financial fallout of the Iraq war. The fears about U.S.-Turkish relations and worries about the fate of the economy without U.S. aid helped shave 10.6 percent off the value of Turkey's bonds in the first quarter, according to the EMBI-Plus. (Additional reporting by Alexander Manda in London) (Reporting by Susan Schneider, editing by Eric Walsh; Reuters Messaging: susan.schneider.reuters.com@reuters.net, tel: +1 646 223 6319)

Reuters, 04.01.03, 2:47 PM ET

NEW YORK, April 1 (Reuters) - A pre-war hike in oil exports from top OPEC producer Saudi Arabia has unleashed enough global crude supply that the cartel will have to start thinking soon about production cuts, experts said Tuesday. Before the U.S. and British led invasion on Iraq, Saudi Arabia had already boosted supply to the highest level in 21 years. The kingdom's production rose by 600,000 barrels per day (bpd) to 9.56 million bpd, according to Geoff Pyne, a Sempra (nyse: SRE - news - people) Energy oil consultant. Global supply has been further swelled by Venezuela's recovery from a two-month oil workers' strike. The extra Saudi and Venezuelan oil has compensated for supply interruptions from Iraq and Nigeria which have taken some 2.5 million barrels per day (bpd) has been taken out of the 77 million bpd global market. "There is so much supply out there that OPEC is probably going to have to start thinking about scaling back some of this output in the not too terribly distant future, unless the Nigerian situation goes on for quite some time," said George Beranek, analyst with PFC Energy in Washington, D.C. Iraq's exports of about 1.7 million bpd have all but trickled to a halt after the U.N. removed monitors overseeing 'oil for food' exports. Clashes between tribes in Nigeria have shut in some 800,000 bpd of 2.2 million bpd exports there. While Nigeria's stoppage has resulted in tighter supplies of light sweet crude, which is particularly good for making gasoline in the run-up to summer, U.S. refiners are not panicking. Oil prices are more that $10 a barrel below 12-year highs hit in late February, falling another 4 percent to $29.67 a barrel on Tuesday. "Iraq's outage was probably the most anticipated supply disruption we've had in a very long time. The market has coped very well with the loss," said Beranek. In fact, the Iraq and Nigerian disruptions have simply given OPEC more breathing space before it will have to make production cuts over the next three months, experts said. "They (OPEC) don't want to have so much inventory built up in the second quarter that it becomes a liability before the end of the second quarter," said Beranek. Saudi Arabia could cut production to 9 million or 8.9 million bpd, said PFC Energy's Roger Diwan. During OPEC's meeting before the war in Iraq, the group killed a move by some members to suspend production quotas during war, but agreed to keep markets well supplied.

BY JEAN-GUY ALLARD —Special for Granma International—

• In Miami, where the judge who sentenced the Five refused to recognize the reign of terrorism, the CANF is openly offering assistance to the hijackers of a Cuban airplane and known terrorists are heading a march against those advocating dialogue with the island

WHILE El Nuevo Herald announced (on March 26, 2003) that U.S. authorities could revoke the citizenship of people connected to terrorism, in Miami — the Kingdom of Impunity — the worst protagonists of anti-Cuban political violence continue living in a world apart.

The mask of decency which the Cuban-American National Foundation (CANF) has tried to construct since it disposed of most of its elements identified with terror has been suddenly shattered by Joe García of Colombia, the group’s spokesman, openly announcing that it was following the case of DC-3’s six hijackers in order to determine "whether they might need assistance," according to an AP dispatch.

After pushing known terrorists like Roberto Martín Pérez out of the rank and file — suspiciously some days after September 11 — as well as his rowdy wife Ninoska Lucrecia Pérez Castellon and other advocators of violence, the CANF had given itself a moderate image, a new marketing appearance more in line with recent surveys that clearly indicate Cuban-Americans’ support for the normalization of relations between the United States and Cuba.

However, on March 19, when the DC-3 Aerotaxi belonging to the Cuban National Air Services Company was hijacked by terrorists who held its pilots at knife point and demanded that they redirect the aircraft to Florida, the CANF suddenly forgot its new image.

A few hours after federal prosecutors announced they were detaining the six dangerous armed criminals, Joe García made a statement to the press that the foundation planned to speak with the air pirates to discover what type of assistance they could offer, as was confirmed by Knight-Ridder in Miami.

García’s statement, which will surely not help promote the mafia organization, was made several days after Miami’s most infamous terrorist hit-man Orlando Bosch declared war on Florida dialoguers, a term designating, as he explained, Cuban-Americans who favor normal relations between the island and its northern neighbor.

BOSCH, LEADER OF DIGNITY?

Killer pediatrician Bosch, responsible for the mid-air explosion of a Cubana Aviation passenger plane and countless terrorist attacks while heading up the bloody group CORU, recently revealed himself as the main promoter — along with the extremist Unidad Cubana group — of a march along Miami’s 8th Street opposing any dialogue between the Cuban-American community and Cuba.

Jesús Permuy, president of Unidad Cubana, a movement made up of various groups responsible for terrorist attacks against the island, explained in El Nuevo Herald, the benevolent diffuser of terror, that the idea of protesting came from "exile groups concerned at the declared intention of some Miami groups to negotiate with the Castro regime, likewise promoted internationally."

In Miami, being ridiculous doesn’t kill. This is how Permuy himself, who appeared before the UN Human Rights Commission in Geneva at one point as a "defender" of human rights in Cuba, maintains his close ties with notorious terrorist organizations.

These ties are so strong that he doesn’t hesitate to associate himself with Bosch and his dirty criminal past, with Luis Posada Carriles and his accomplices imprisoned in Panama, as well as with Raymond Molina, the latter’s right-hand man, or Eugenio Llamera, the now famous inventor of the terrorists’ commission on Visa and Master Card.

José Ramón "Raymond" Molina was born in Cuba in 1934 and had strong connections with Fulgencio Batista’s dictatorship.

He participated in the failed Bay of Pigs invasion and was a CIA operative for 30 years.

As a known supporter of Richard Nixon, he even unsuccessfully ran for Congress and later, equally unsuccessfully, for mayor of Miami.

Molina had connections with Nicaragua’s Somoza regime and later with the anti-Sandinista counterrevolution, and is known among drug trafficking circles.

He has been living for years in Panama, home of the national anti-Cuban mafia. With the complicity of Panama City’s former mayor Mayín Correa, he is currently using all available means to promote the release of Luis Posada and his hitmen.

Molina is also in charge of organizing the defense and possible bribed escape of Posada Carriles with the collaboration of a terrorist detachment made up of personalities such as René Cruz Cruz, Eusebio Peñalver Mazorra, Jorge Borrego, Nelsy Ignacio Castro Matos and Santiago Álvarez Fernández-Magriña.

It’s worth recalling that the majority of these individuals, connected with Unidad Cubana and the CANF, were among those on the list of known terrorists handed over to the Panamanian authorities in November 2000, the day before the 10th Ibero-American Summit was to take place in that country.

All of them regularly "go down" from Miami with large sums of money to pay the narco-attorney Rogelio Cruz, meet with Posada Carriles in El Renacer prison or participate in disinformation campaigns.

PEREZ ROURA AND RADIO TERROR

This money appears in the hidden funds of the anti-Cuban mafia and collection campaigns that Jesús Permuy and his good friend Pérez Roura, director of Radio Mambí, regularly engage in to support the four terrorists in prison in Panama.

Octogenarian Pérez Roura, a former member of the Alpha-66 paramilitary organization and correspondent for the United Revolutionary Organizations Coordination Committee (CORU) terrorist group, continues to be active with Unidad Cubana.

During his morning program, Pérez Roura promoted the march in response to those in favor of dialogue with the same energy he has used to incite violent acts against Cuba with impunity.

Special guest Orlando Bosch, on the "En Caliente" program, introduced as the "president of the People’s Protagonist Party," emphatically announced the march against dialogue has to be the biggest in history, despite the fact that there are many inclined to pull the rug out from under the exile force."

Then, in reference to recent polls revealing majority exile community support for dialogue with the island, claimed that "here, the polls have been greased with money so as to confuse the émigrés."

Inevitably, the unmistakable Ninoska Lucrecia Pérez Castellón is participating in the extremist chorus, with frenzied calls to participate in the march and fanning the flames against the normalization of relations with Cuba. She has been a member of the terrorist Council for the Freedom of Cuba’s executive junta since she was purged from the CANF.

TERRORISM IN ACTION

Recently, various leaders of organizations in favor of normalizing relations with Cuba were thrown out of the Holiday Inn Hotel, located on 2051 LeJeune Road, just before a press conference. Minutes before the conference was to get underway, Coral Gables police ordered participants to abandon the premises despite the fact that they had already paid for the room.

Finally, the press conference took place in the parking lot of the aforementioned hotel. Nobody is quite sure what kinds of threats were made against the Holiday Inn group to provoke such high anxiety levels, but it is no secret that the South Florida mafia has honed the act of threatening and sewing fear into an art form.

Yet again, Miami showed its true colors as a sanctuary of terror where conspiring against Cuba, solidarity with hijackers and support for terrorism are all authorized activities.

Meanwhile, the five Cuban patriots imprisoned in the United States continue to be the victims of mistreatment after having been sentenced in a fraudulent trial for having contributed to the fight against terrorism.

A bloody record

Hostility by Miami fanatics towards any dialogue on the normalization of relations between Cuban and the United States has been demonstrated on a number of occasions. Nevertheless, two infamous cases illustrate beyond any reasonable doubt the total fanaticism of South Florida’s terrorist circles.

While Orlando Bosch personally directed waves of assassinations in both the United States and various Latin America countries from his prison cell in Venezuela, another group, Omega-7, savagely executed two Cuban émigrés who held positions of rapprochement to the island.

On April 28, 1979, Carlos Muñiz Varela, a Cuban tour operator based in Puerto Rico, was shot down and died the following day. In January of the same year, Omega-7 had claimed responsibility for a car bomb at Muñiz’s tour agency in San Juan. Evidence suggests that the killer could very well have been Pedro Remón, the individual currently jailed along with the gang’s chief, Luis Posada Carriles.

On November 25 of that same year, Eulalio José Negrín, a member of the Committee of 75 and a participant in the December dialogue with Cuba the previous year, was murdered in front of his 12-year-old son at his home in Union City, New Jersey. On November 9, 1984, Pedro Remón was identified as Negrín’s assassin by Omega-7 chief Eduardo Arocena.

On April 10, 1986, Judge Robert L. Ward sentenced Remón to 10 years’ imprisonment for a long series of murders and attempts. The killer didn’t even complete half of his sentence.

Pronouncing his reduced sentence, the judge openly expressed his "sympathy" for the terrorist’s "cause."

The Capitol By NOI MAHONEY Business Writer

As gasoline prices soar toward all-time highs, Ron Stewart said the higher gas prices are slowly eating into his profits.

With everything from lawn mowers, trucks, tractors and other equipment, the owner of Ron Stewart Landscaping in Annapolis said his company depends on gasoline. But he said he hasn't really thought of passing the costs on to his customers. Instead, he said he will weather the storm and wait for gas prices to drop. "I haven't raised prices," Mr. Stewart said. "I don't think you can raise prices in this market, it's too competitive." Like Mr. Stewart, business owners burdened with record costs for gas said raising their prices to compensate is not a likely option. The problem lies in the ultra-competitive nature of the Annapolis-area market. "High gas prices cut into margins and generally this is passed onto consumers," said Bob Burdon, president of the Annapolis and Anne Arundel Chamber of Commerce. "But we are in a very competitive market, and many local retailers don't want to price themselves out." Gasoline costs about 47 cents a gallon more than a year ago. Self-serve regular gasoline averages a $1.65 a gallon at area gas stations. About two weeks ago, gas prices topped $1.70 for regular. In February, gas prices hovered around $1.66 as compared to $1.55 in January. Mr. Burdon said companies which could be affected by higher gas prices include anyone with sales forces, service technicians, or companies that need to move heavy equipment. "The challenge is not just gas, the war will effect spending habits as well," Mr. Burdon said. Gas price increases reflect the tight inventories and high price of crude oil, caused by falling imports from Venezuela and fears that the war in Iraq could last for a long duration of time. Anirban Basu of Baltimore-based economic research consulting firm Optimal Solutions Group, said the increased gas prices is another hardship on local businesses, which will eventually have an impact on consumers. Mr. Basu said when a company is forced to absorb losses from higher gas prices, it will lead to lower profitability, less hiring, less bonuses and less expansion. "Every recession in recent times was preceded by a spike in energy prices, like the kind we just experienced," Mr. Basu said. Nationwide, economists worry companies will increase their prices to make up for the gas prices. Alan Gin, an economics professor at the University of San Diego, estimated local consumer spending declines $5 million a month for every 10-cent increase in the price of a gallon of gas. "The price of gasoline will take buying power out of the hands of consumers," Mr. Gin said. But in the Annapolis area, which is buoyed by the boating and tourism industry, companies said raising prices could do irreparable damage. The price of marine fuel varies, but is floating around $2.19 for premium and $1.49 for diesel. Larry Kety, manager of the Annapolis City Marina, keeps a close eye on wholesale prices. "It is tough with our market," Mr. Kety said. "We are a big company, but we try to be the nice guy in town. We don't want to take advantage of our customers."

nmahoney@capitalgazette.com

April 1, 2003, 3:07PM Reuters News Service

NEW YORK - Oil prices fell 4 percent today as Nigerian unions called off a planned general strike, raising hopes that oil production halted there by recent ethnic clashes might soon restart.

The move eased fears of further disruption to world oil supplies with Iraq's crude exports halted since near the start of a 13-day U.S.-led invasion.

U.S. light crude slid $1.26 a barrel to $29.78 while London benchmark Brent futures fell 82 cents to $26.36 a barrel. Oil prices are more that $10 a barrel below 12-year highs hit in late February.

Prices fell as Nigeria's biggest union called off a planned three-day strike. "News of the agreement on the Nigerian strike has given the market some breathing room," one London oil trader said.

Recent tribal clashes have shut nearly 40 percent of Nigeria's 2.2 million barrels per day of crude production for more than a week. The West African country is one of the top six oil suppliers to the United States and U.S. refiners need Nigeria's high-quality crude to build up gasoline stocks for summer.

Oil companies Shell and ChevronTexaco have said they will not resume operations from Forcados and Escravos in the western Niger Delta region until they can be sure of their staff's safety.

Jitters spurred by the Nigerian and Iraqi supply disruptions have helped support oil prices in recent days since the market fell 25 percent just before the the war when dealers took the view that Baghdad would not resist for long.

Tuesday's falls gained pace after Iraq's Information Minister delivered a television message from President Saddam Hussein, fueling speculation that the Iraqi leader may be dead.

"People interpreted the fact that Saddam Hussein did not deliver his own message as 'He is no longer with us,'" said a New York trader.

Prices have come under further pressure from signs that world oil supplies are sufficient to meet lower seasonal demand in the second quarter.

"What's driving prices right now is the offset between supply security fears, balanced against expectations of softer demand, which you normally get at this time of the year," said Kevin Norrish, energy analyst at Barclays Capital.

The Organization of the Petroleum Exporting Countries has compensated for lost Iraqi and Nigerian crude with increased supplies. Top world exporter Saudi Arabia in March hit its highest production level for 21 years.

"As far as the war is concerned, we have lost Iraqi supplies but clearly OPEC is still managing so far to make up for that," Norrish said.

Global energy demand on the 77 million bpd world market normally drops about 2 million bpd in the second quarter when warmer weather sets in the United States and Europe.

Demand then picks up again when gasoline consumption for motorists rises during the summer holidays.

Nigeria's high-quality crude, ideal for gasoline production, is missed because it is a popular feedstock among U.S. refiners.

Gasoline stocks in the United States are running well below year-ago levels as the world's biggest consumer of motor fuel gears up for peak demand.

"Looking at where U.S. gasoline inventories are and where prices are, lots will depend now on how soon Venezuela will get its gasoline production back to normal," Barclays' Norrish said.

Venezuela, struggling to get output back on stream after a crippling opposition strike, has said it will this week restart gasoline exports to the United States and expects all refining and exports to return to normal within four to six weeks.

The strike had contributed to extremely tight oil inventories in the West even before the war in Iraq.

Analysts polled by Reuters predict that U.S. government data due on Wednesday will show a large crude stock rise after a week of heavy imports.