<a href=quote.bloomberg.com>Bloomberg.com By Mark Shenk

New York, April 2 (Bloomberg) -- Crude oil fell on expectations the war in Iraq is moving closer to an end, after the U.S. said coalition forces advancing toward Baghdad destroyed a division of Saddam Hussein's Republican Guard.

Fourteen days of fighting haven't slowed shipments from neighboring Saudi Arabia, the world's top exporter, said Lamees al- Ali, a spokeswoman at state-owned Saudi Aramco. Kuwait and Qatar also said shipments are normal. Persian Gulf countries pump about a quarter of the world's oil. Price declines accelerated after the U.S. said oil imports rose to a record last week.

Traders are betting that the war will be over in a matter of a couple of weeks, with Iraqi exports back to normal in about three months,'' said Phil Flynn, a senior energy trader at Alaron Trading Corp. in Chicago. We've heard that there are people working on the southern fields now, so it could be even sooner.''

Crude oil for May delivery was down $1.28, or 4.3 percent, at $28.50 a barrel as of 11:48 a.m. on the New York Mercantile Exchange. Easing concern of disruptions to Persian Gulf exports has sent prices down 28 percent from a 12-year high of $39.99 a barrel reached on Feb. 27. The 1991 Gulf War lasted six weeks.

In London, the May Brent crude-oil futures contract was down $1.04, or 4 percent, at $25.32 a barrel on the International Petroleum Exchange.

The Energy Department in a weekly report said U.S. inventories rose a greater-than-expected 6.8 million barrels, or 2.5 percent, to 280.7 million barrels in the week ended March 28. A Bloomberg survey of analysts predicted an increase of about 2 million barrels.

Record Imports

U.S. crude-oil imports were the highest recorded by the Energy Department since it began compiling weekly figures in 1990, said Doug MacIntyre, a senior oil market analyst with the department's Energy Information Administration.

Imports rose 7.3 percent to 10.36 million barrels a day. Venezuelan shipments were close to normal, the department said. A strike that began Dec. 2 had disrupted exports from the South American country, which in November provided about 10 percent of the oil used by U.S. refineries.

Saudi Arabia and Venezuela ``said they were increasing production and we are now seeing it reflected in inventories,'' said Jay Saunders, an analyst at Deutsche Bank Securities in New York.

Iraq, the third-largest producer in the Persian Gulf region, pumped about 3 percent of global supply in February, before the war started. The nation shipped about 7 percent of the oil imported by the U.S. in January.

Baghdad Guard Division

The Republican Guard's Baghdad Division is no longer able to operate as a fighting force, U.S. Army Brigadier General Vincent Brooks said, without providing details, during a televised briefing at the U.S. Central Command's Qatar headquarters.

Two other divisions, each numbering about 12,000 men at full strength, are under ``serious attack'' near Karbala, 50 miles southwest of the capital, he said.

In Nigeria, international oil companies have halted production of about 800,000 barrels a day in the past two weeks, or more than a third of the country's output, because of fighting between government troops and ethnic Ijaw militants before presidential elections on April 19. Last Updated: April 2, 2003 12:10 EST

<a href=reuters.com>Reuters Wed April 2, 2003 12:04 PM ET By Susan Schneider

NEW YORK, April 2 (Reuters) - Brazil's sovereign bonds trotted higher on Wednesday as investors expected Congress to approve a bill paving the way to Central Bank autonomy, a vote widely viewed as a litmus test of the government's ability to push through more radical economic reforms.

Brazil's share of J.P. Morgan's Emerging Market Bond Index Plus, about one-fifth of the total index, added 0.56 percent in early New York trading. The benchmark C bond BRAZILC=RR drooped 0.125 points lower to 81.25 bid.

Brazilian bonds built on their impressive surge of the last three months as optimism continued to run strong for President Luiz Inacio Lula da Silva's plans to overhaul the social security and tax regimes. Lula has said he would send Congress the legislation on the two reforms this month.

In the meantime, Congress was set for an afternoon vote on an amendment changing the financial system's legal framework, a necessary step in the government's effort to give the Central Bank more independence. Investors are watching the vote for signals that Lula has the influence to pull off other politically sensitive reforms, said analysts.

"What people are beginning to focus on is what kind of majority the government will be able to muster," said Suhas Ketkar, senior economist and head of emerging markets analysis at Royal Bank of Scotland.

"This is a constitutional amendment, which requires 308 votes. If they get a significantly larger number of deputies supporting the government, say they get 400 votes, that would be very positive because that would indicate the government has the ability to put together coalitions, and that spells good news for the reforms to follow," said Ketkar.

Since taking office on Jan. 1, Lula's pledges to keep a tight rein on public finances and to pursue reforms have won over investors, who paled at the thought of the former union boss in power just a few months ago. Lula had spooked Wall Street with talk of debt renegotiation in previous campaigns.

The sanguine reform view has helped Brazilian bonds skyrocket nearly 23 percent so far this year. Spreads over comparable U.S. Treasuries, or the premium investors demand to compensate for incurring extra risk, have steadily narrowed to close below 10 percent on Tuesday for the first time since May, 31, 2002.

Traders and analysts said approval of Wednesday's vote was largely priced into bonds, but they noted a failure to pass the measure could provide a negative shock to the market.

"I think everyone is expecting it to pass broadly so we really only have downside from it -- if it doesn't pass it will be bad (for bonds)," said an emerging debt trader.

OIL, RESTRUCTURING PINCH VENEZUELA

Venezuelan debt bucked the rising tide of Brazilian bonds with a 0.20 percent drop on the day. Venezuela's DCB bond VENDCB=RR dove 0.875 points to 70.5 bid.

The slide came amid growing optimism that an end to the U.S.-led war in Iraq may be in sight. With U.S. troops now on the outskirts of the Iraqi capital, Baghdad, investors bet the troops' progress could soon translate into a resolution.

If the war does end sooner rather than later, Middle East oil supplies would not likely see heavy disruptions, which in turn would mean that oil prices could come down. This would be negative for Venezuela, which normally relies on the commodity for about half its government revenues, said analysts.

At the same time, investors are also taking stock of Venezuelan bonds in light of the country's plans to undertake a voluntary restructuring of its debts.

Beyond the prospect for falling oil prices, there is "a realization that the market is going to have to face this voluntary restructuring," said Christian Stracke, head of emerging markets strategy at research firm CreditSights.

"While most people probably agree there won't be any (net present value) negative result, there's still uncertainty surrounding it and as we've seen Uruguay -- a similar situation -- people don't really like to hold it until details of this kind of an exchange are out," said Stracke.

Reuters, 04.02.03, 10:54 AM ET

NEW YORK (Reuters) - U.S. crude oil stocks jumped by 2.5 percent last week as a rush of new supply from top world exporter Saudi Arabia pushed imports to the highest level on record, government figures showed on Wednesday.

Crude oil stocks ballooned 6.8 million barrels to 280.7 million in the week ended March 28, the Energy Information Administration said in its weekly supply report.

Stocks swelled as U.S. crude oil imports jumped to nearly 10.4 million barrels per day (bpd), the largest average on record, the EIA said.

"Crude oil imports from Saudi Arabia increased sharply, an apparent reflection of much higher production that began in February," the EIA said.

Crude oil imports have averaged 9.1 million bpd over the last four weeks, which is more than 400,000 bpd more than averaged over the sameperiod last year, the EIA said.

"The tidal wave of crude we've been waiting for has finally hit our shores," said Bill O'Grady, analyst with A.G. Edwards.

Imports have also recovered from big regional supplier Venezuela, which is recovering from a two-month workers' strike that crippled its oil industry.

"Imports from Venezuela last week seemed to average close to normal levels," the EIA said.

The increased stocks give more of a cushion against the loss of Iraq's 1.7 million bpd of crude exports since the first days of a two-week U.S-led invasion.

Nearly 40 percent of Nigeria's oil production has also been shut in due to ethnic violence there ahead of mid-April elections. Nigeria is one of the top six U.S. oil suppliers and its high-quality crude is good for making gasoline.

Oil prices were down $1.28 at $28.50 a barrel after the report, already driven down by military advances in the U.S-led war against Iraq.

Gasoline inventories rose by 1.7 million barrels to 200.7 million barrels last week, though remain below the low end of the normal range, the EIA said.

"We're hearing Venezuela exports of gasoline are finally restarting and that's something we'll be watching very closely," O'Grady said.

Venezuela's strike also cut into gasoline supplies, and refiners have been unable to step up gasoline production as much as normal as they worked to meet heating fuel demand during a cold northern winter.

Distillate fuel inventories, including heating oil, decreased by 1.6 million barrels last week, the EIA said.

Industry group the American Petroleum Institute, which issues a supply report at the same time, said that crude stocks rose by 9.0 million barrels, distillate stocks fell 3.3 million barrels and gasoline stocks rose 2.5 million barrels.

<a href=reuters.com>The World Bank Wed April 2, 2003 10:59 AM ET

WASHINGTON, April 2 (Reuters) - The World Bank on Wednesday predicted Latin America would see a small 1.7 percent bounce in real GDP this year, closing the book on a gloomy 2002 when an Argentine recession weighed the region down.

The projection assumes Argentina will swing into positive growth territory this year. That country's 11-percent drop in gross domestic product was mainly responsible for Latin America's economy shrinking 0.9 percent in 2002, the Bank said.

Excluding Argentina, the region would have grown a modest 0.8 percent.

Looking ahead "the forecast assumes that challenging external financial markets will remain a headwind against the region for the next couple of years, although the worst of the credit cycle is now behind us," the World Bank stated in its latest Global Development Finance report.

For 2004, the World Bank forecasts 3.8 percent growth.

Latin America was the world's worst-performing region last year, pounded by big recessions in Argentina, Venezuela and Uruguay and election uncertainty in Brazil. Sharp drops in capital flows also hurt as investors shunned what the bank calls the "heavily indebted economies of Latin America."

This year, Argentina's GDP should rise 2.6 percent, even though the World Bank cautions the country is a "wild card."

"There is now clear evidence that the economy has moved off its lows and that banks have recovered sufficiently for the payments system to be up and running again," the report says.

"What is unknown is how enduring this phase will be."

If Argentina's presidential elections in April produce a strong government that strikes an early deal with the IMF and external creditors, "then there should be substantial scope for growth."

Argentina and the IMF tried over 11 months to strike a deal for that country to obtain much-needed aid, as both sides haggled over issues that ranged from bank restructurings to utility rates.

Both sides then opted for a more modest agreement that reschedules payments to multilateral lenders until a new government takes over at the end of May.

The report says "gross market-based financial flows" to the region fell by $31 billion, down 40 percent. Net foreign direct investment dropped to $42 billion from $69 billion in 2001, "with declines evident across all countries."

"Sluggish growth and a slowdown in economic and political reforms are expected to continue to hold back FDI flows to Latin America."

Foreign Investment, Remittances Outpace Debt As Sources of Finance For Developing Countries: World Bank

SkyePharma PLC Preliminary Results Announcement for the Year Ended 31st December 2002 Wednesday April 2, 7:31 am ET

LONDON, April 2 /PRNewswire-FirstCall/ -- SkyePharma PLC (Nasdaq: SKYE - News; LSE: SKP - News) today announced the Company's financial and operating results for the year ended December 31, 2002. ......Our 2001 strategic collaboration with Astralis Ltd (Astralis) covers the development of Psoraxine(TM), a unique injectable treatment for psoriasis, a chronic skin disorder that affects approximately 3% of the world population. There is no approved cure for psoriasis and most approved treatments provide only temporary or incomplete relief and may also cause serious side effects. Psoraxine(TM) is a protein that stimulates cells from the patient's immune system to reverse the inflammatory process responsible for psoriasis symptoms. Astralis has completed clinical studies in Venezuela using first generation Psoraxine(TM) to treat nearly 3,000 psoriasis patients, the vast majority of whom responded positively with few side effects. We are working with Astralis to develop a second-generation product, now being produced in the USA, and to validate the promising results from Venezuela in US clinical studies that will be used for regulatory and marketing approval. Following the recent completion of toxicological studies, Astralis expects authorisation to commence US clinical trials later this year.