Oil slips as Saddam falls in Baghdad
Posted by click at 8:21 AM
Stuff
11 April 2003
LONDON: Oil prices dropped yesterday as the rapid fall of Iraqi President Saddam Hussein in Baghdad kept pressure on prices in what traders called a bearish market.
Also weighing on markets was a report from the West's energy watchdog, the International Energy Agency, saying a "wall of crude" is poised to reach importing countries in the second quarter, the weakest period for demand.
Scenes in central Baghdad of thousands of jubilant civilians defacing pictures and toppling statues of Saddam, coupled with streets filled with US tanks and devoid of Iraqi police beamed around the world on Wednesday, fuelled the belief that Saddam's rule had ended in the capital.
"Iraq is still the main news in the markets," said Christopher Bellew of brokers Prudential-Bache International.
US light crude oil on the New York Mercantile Exchange slipped 59 cents to $28.26. London Brent blend was down 47 cents to $24.78 in thin electronic trade.
In Iraq, US forces continued to attack forces loyal to Saddam, having taken central Baghdad with little resistance.
The BBC reported that US-based Kurdish forces had taken the key northern Iraqi oil city of Kirkuk without a fight on Thursday. A spokesman for the Kurdistan Democratic Party told Reuters they were still making checks on the situation.
Oil markets appear to have accepted a US victory in the battle to unseat Saddam, with the focus now shifting to how quickly Opec will move to restrain production.
Continued speculation that Opec will cut production quotas or simply reduce excess supply at a proposed emergency meeting kept prices supported, although a potential delay to the proposed April 24 date has limited its impact.
Opec President Abdullah al-Attiyah said several other dates were under consideration - April 28, May 3 and May 7.
Cartel linchpin Saudi Arabia has also told its global and Asian oil customers that it will continue to supply full contractual volumes next month, indicating any cut-back in production over quotas may have to wait until June.
Saudi Arabian Oil Minister Ali al-Naimi said on Wednesday that Riyadh was not considering cutting supplies for May ahead of the proposed Opec meeting.
Opec SIZES UP MARKET
The Organisation of Petroleum Exporting Countries had increased output this year to counter supply disruptions from Venezuela, Nigeria and Iraq - but now attention has shifted to a potential oil glut developing during the weak second quarter.
Opec-member Iran's oil minister said on state television world oil markets were over-supplied, but the head of the IEA said industial stockpiles needed to rebuilt.
The agency said in its monthly report that despite an apparent "wall of crude" heading toward importers' shores, a cut in Opec production now appeared "premature."
Opec at the proposed emergency meeting is expected at least to erase excess supplies of some two million barrels a day now being pumped above formal output limits of 24.5 million bpd.
Algerian Oil Minister Chakib Khelil said on Wednesday Opec would be able to achieve market balance just by complying with official limits without cutting quotas.
Leading Opec producer Saudi Arabia pushed output 1.5 million barrels a day above its official quota to help cushion the impact of the loss of Baghdad's 1.7 million barrels per day (bpd) of exports during the US invasion of Iraq.
US Vice President heightened expectations of a return of Iraqi oil to world markets, saying on Wednesday he expected Iraqi exports could reach as much as three million bpd by the end of the year. The Gulf State was producing about two million bpd last year, according to the US Energy Department.
Posted by click at 8:16 AM
IMF predicts 17 percent downfall in Venezuelan economy
"Even though the strike in the state oil company (Pdvsa) has recently been terminated, estimations show a 17 percent shrinkage in real GDP, while inflation rate is to amount to 40 percent by the end of the year," the IMF said in its World Economic Outlook.
See also
- OPEC efforts ease disruption in oil markets
- Venezuelan Vice President denies air raids against Colombia
- OPEC is creating a tidal wave of crude oil that cannot all be absorbed
- Political jittery in Venezuela causes concern in Italy
- EDITORIAL COMMENT: The negligence of deputies in Venezuela
- 33,523 people have been killed in Venezuela during President Hugo Chávez's term
- Four pro-government April 11 shooters released on probation
- "We want neither guerrillas nor paramilitary"
- The military wing of the Venezuelan revolution
- Draft bill on crimes relating to foreign exchange trades
- Flash REPORT (Venancham)
LATEST NEWS
The Caracas Stock Exchange Index (IBC) closed lower on Thursday, losing 23.52 (0.28 percent) compared to the previous session, El Diario de la Bolsa said.
The IBC closed at 8,492.60, while the Industrial Index and the Financial Index finished at 6,848.33 and 15,905.02, respectively.
In 35 transactions, 312,496 shares were traded for VEB 114,008,256.35. At the end of the day, one share closed higher, two fell, and six remained steady.
In the fixed-income market, commercial papers and public bonds were traded for VEB 9,9 billions in 760 transactions.
A year after the violent events of April 2002, Venezuelan human rights organization Cofavic issued an official statement rejecting the impunity that has surrounded those events. "Up to now, there is no arrested or sentenced person in connection to death and lesions caused to hundreds of people from April 11 to April 14, 2002," the group said.
Cofavic expressed its concern about the abandon in which relatives of the April 11 victims have been left. It said that during April 12,13, and 14 "anarchy and a disproportional use of public forces seized the capital."
"In the hope to reach justice, Cofavic accompanies the relatives of César Matías Ochoa and Alexis Bordones, who died during the tragic events nearby presidential palace Miraflores on April 11, 2002, as well as the relatives of Rommy José and Yurmi Noé Nieto Laya, two young people murdered by alleged officers from Policía Metropolitana on April 12, 2002," the statement continues.
The organization also remembered other cases and said that "up to now all the cases remain in impunity and in the first stage of the criminal investigation. There is no acceptable explanation for" this lack of progress.
EARLIER NEWS
Amnesty International urged the Venezuelan government to investigate the violations to human rights committed during the events of April 11, 2002, that resulted in more than 50 dead.
In its official statement made public today, the human rights organization said that "Venezuela's government and opposition have failed to face up to their part in the tragedy and ensure that those responsible are brought to justice," news agency Efe reported.
"It is time that both the government and opposition stop attempting to use the events of April 11 to serve their political agendas and instead create the climate in which the facts can be established, justice can be secured and the victims can receive reparations," the organization said.
"The recent dismissal of murder charges against those accused of shooting from the Puente Llaguno, and the failure to charge Metropolitan Police implicated in the deaths and injuries suffered on 11 April, demonstrate the weakness of the official investigation. It also raises serious concerns about the capacity of the state to effectively prosecute all those responsible," the statement continued.
"The investigation and judicial process must lead to justice for the victims and their relatives, in order to avoid the pattern of impunity of other notorious cases of serious human rights violations which haunt Venezuela's recent history," said Amnesty International.
The world meeting in solidarity with the Bolivarian revolution, gathering as of today opponents to globalization and neo-liberalism who support president Hugo Chávez, was installed with a speech delivered by the director of the French newspaper "Le Monde Diplomatique," Ignacio Ramonet, who spoke about "the war in Iraq and the new international order," news agency Efe reported.
Before criticizing the invasion of Iraq by US and British forces, Ramonet expressed his solidarity with "the Bolivarian democratic revolution," and with Chávez, to whom he described as a "democratic ruler."
The only reference to Venezuela in his speech was devoted to the "involvement" of United States in the "criminal attempt against Venezuelan democracy" on April 11, 2002, and the risk that Venezuela could be an objective in the new US foreign policy, based on its military supremacy.
Ramonet said that the power US will wield from now on in Iraq could have an impact on the Organization of Petroleum Exporting Countries (OPEC) -that US considers an "adversary"- as well as on Venezuela, which belongs to this cartel.
The meeting is held to celebrate the first year of the return of Chávez to power after being overthrown for 48 hours by a civic-military coup. The participants include the US sociologist James Petras; the militant French farmer Jose Bové, the Philippine ecologist Walden Bello, the British historian Perry Anderson, and the Bolivian indigenous leader Evo Morales.
The Venezuelan Defense minister, Gen. José Luis Prieto Silva, said on Thursday that he does not believe "that Colombia has any interest in disturbing the government of the president of the Bolivarian Republic of Venezuela, Hugo Chávez Frías, as no country with so close links with Venezuela, and even less a Bolivarian nation, should disturb a democratic government."
Prieto added that those intending to create discrepancies between Colombia and Venezuela will not achieve their goal. "Venezuelans have a very clear idea of the historical background of bilateral relationships, and nobody will make us fall into the trap to propitiate a conflict between two neighbor countries."
Roy Chaderton, the Venezuelan Foreign Affairs minister, stated on Thursday that he is confident that the United Nations is to recover "its capacity" as a guarantor of peace and that multilateralism will prevail in addressing Iraq's future, news agency EFE reported.
Chaderton is in Madrid, where he and his Spanish counterpart, Ana Palacio, have discussed bilateral relationships and war in Iraq, among other issues.
Asked about the repercussions of the Iraqi conflict on crude oil exports and prices, Chaderton defended the current role of the Organization of Petroleum Exporting Countries (OPEC). "OPEC should continue an group having influence" in reaching reasonable production and price levels, he stressed.
As to the meeting between Venezuelan and Colombian presidents, Hugo Chávez and Alvaro Uribe, respectively, scheduled for next week, Chaderton said it will be a "cordial" interview, where security and business topics are to be addressed. He reminded that every time that campaigns against drug traffic are launched, there are people interested "in making Venezuela and Colombia fight," but that will not happen.
The Venezuelan Vice President, José Vicente Rangel, denied on Thursday that President Hugo Chávez's government is opposed to a recall referendum aimed at terminating Chávez's mandate, an option that the Negotiation and Agreement Table is currently evaluating as a solution to the country's political crisis.
Rangel claimed that "multiple revoking referenda" may be held, not only to challenge Chávez's administration, but also the performance of all officials elected by the people's vote. He did not rule out the possibility of general elections.
"Forget this idea that the government does not want recall referendum; this government respects the Constitution," he stated.
"If the National Electoral Council (CNE) requests the recall referendum and the vote is agreed, once signatures are collected or when the validity of signatures already gathered is determined, the government is ready to facilitate funds and security" for the binding popular consultation.
Eighty-three percent of Venezuelans comprise the socioeconomic group D, with a monthly income inferior to $625, according to a study prepared by the consultancy firm Datos Information Resources.
The company confirmed that consumption in Venezuela has been dropping steadily in the last years: by the end of 2002, household monthly expenses amounted to VEB 20 billion, VEB 8 billion lower than the figure recorded by the end of 2001.
Datos predicted a 13 percent fall in consumption for this year, linked to a 15 percent decrease in Gross Domestic Product.
A group of Colombian top officials started on Thursday an investigation on the reports of supposed Venezuelan Air Force attacks against a paramilitary group in Colombian territory, news agency AP reported.
"They are going to record the testimonies of peasants in the area that claimed to have witnessed the raids," Colombian Defense minister, Martha Lucía Ramírez, told radio station W FM.
The incident reportedly occurred on March 21 and 22 at La Gabarra area, 280 miles northeast Bogotá, when the paramilitary clashed with guerrillas of the rebel Colombian Revolutionary Armed Forces (FARC).
Ramírez explained that the Colombian government "has not issued an official statement on this case," as the reports by peasants is the only information available so far. "For this reason, we have sent five military delegates and three officials from the Foreign Relations Ministry (to the area) to hear witnesses, verify the events and prepare a report," she added.
Alí Rodríguez, president of the state-run oil company Petróleos de Venezuela, S.A. (Pdvsa), said on Thursday that he expects that crude oil exports from Venezuela to average 2.95 million barrels per day in April.
Venezuela, a member of the Organization of Petroleum Exporting Countries (OPEC), is therefore showing a rebound in its vital oil sector, after an opposition-led two-month nationwide civic strike that ended in February.
In an oil conference being held in Paris, Rodríguez stressed the ascending course of exports, which in March amounted to an average 1.93 million bpd, 891,000 bpd in February, and 577,000 bpd in January.
A proposal presented by Venezuelan President, Hugo Chávez, and Planning minister, Felipe Pérez, to control interest rates and reduce the spread between loan and savings interest rates by 10 points is setting off alarms in the Venezuelan Central Bank (BCV) and the Banking Superintendence.
Sources at the BCV directorate have said that the most suitable way to lower interest rates is using market mechanisms, while the Banking Superintendence has stated in a report that the Venezuelan banking system is well capitalized and provisioned, but if a rate control is implemented such a move will have an impact on the financial sector.
In average, in Venezuela the bank profitability significantly relies on the preservation of the spread between loan and savings rates, which amounted to 17.3 points by the end of February.
The 11th Crime Control Court issued arrest warrants for dissident National Guard officers Juvenal Mora and Víctor Valero, who declared in civilian disobedience against President Hugo Chávez, like other several dozens of soldiers based at Plaza Francia, Altamira, northeast Caracas.
The court's judge, Deyanira Nieves, decided that there is evidence to prove their involvement in civilian rebellion, incitement to sedition (performance of acts that lead people to take up arms against government), conspiracy for rebellion, and illegal possession of war weapons. Punishment for rebellion ranges from 12 to 24 years in prison.
OPEC no longer an oil threat to West, IEA says
Posted by click at 8:03 AM
April 10, 2003, 2:14PM
Reuters News Service
PARIS -- The head of the West's Energy watchdog said today that OPEC had shown through its sharp increase in oil output to cover for Iraq that the once-feared cartel is no longer a threat to rich nations.
Claude Mandil, executive director of the International Energy Agency, told Reuters that the Organization of the Petroleum Exporting Countries had demonstrated they share goals with oil importers such as the United States.
"The past months have proved that OPEC and consumers can share a lot of common goals," Mandil said in an interview.
"I don't feel OPEC is a threat. Thirty years ago it was considered so because oil was used as a weapon," he added.
Cartel leader Saudi Arabia, Iran and other OPEC members have lifted oil supplies sharply to cover for the shortfall from Iraq, and other export hitches in Venezuela and Nigeria, helping to cool a spike in prices.
OPEC's reference oil price has slumped from above $33 per barrel last month to below OPEC's target level of $25 this week.
The Paris-based agency was set up in the wake of the 1973 oil crisis, when Arab oil powers placed an embargo on the West. It oversees huge emergency stockpiles to be used in the case of another major supply disruption.
But cooperation between the two bodies has grown to such an extent that the IEA held back from releasing stocks when Iraqi exports stopped last month, trusting in OPEC's ability to maintain ample supplies.
OPEC ministers are now discussing a cut in supplies to stop prices falling further.
Mandil said OPEC and oil importers still disagreed over price, and said OPEC's $25 per barrel target was so high as to damage world economic growth. It also constituted a disincentive for companies to hold sufficient inventory levels, he said.
"Price is not a shared goal. I say this price is too high," Mandil said, declining to specify his ideal price.
"We believe the price should be the result of market forces, not market management," he said.