April 16, 2003, 12:38PM By DAVID IVANOVICH Copyright 2003 Houston Chronicle Washington Bureau

WASHINGTON -- OPEC will consider slashing its crude production next week, fearing the quick war in Iraq could send crude prices nose-diving.

Oil prices edged closer to $30 a barrel Tuesday after oil ministers finally agreed to meet April 24 in Vienna.

The goal of this meeting is to rethink the Organization of the Petroleum Exporting Countries' production strategy for the coming months.

"All options" will be on the table, OPEC Secretary-General Alvaro Silva said.

Some OPEC watchers say the cartel could agree to cut production by nearly 2 million barrels a day, or about 7 percent, from current levels.

So far this month, the 10 OPEC countries whose output is controlled by production ceilings have been pumping 26.4 million barrels a day, according to the U.S. Energy Information Administration.

That's 1.9 million barrels a day more than their output quotas would allow.

The OPEC producers have been pumping a great deal of extra crude in recent weeks to offset the loss of nearly 2.5 million barrels a day of Iraqi crude production, which has been off line since the war started.

The OPEC countries had pledged to make up for any supply disruptions as a way to dissuade the United States and other industrialized nations from tapping their strategic petroleum reserves.

But the speedy U.S.-led victory in Iraq and the relatively minor damage inflicted on Iraq's oil fields have wiped out most of those war jitters.

And now OPEC members are asking whether the group's output is about to glut the market.

"I think they'll go back to their quota," noted John Lichtblau, chairman of the New York-based Petroleum Industry Research Foundation.

Michael Rothman, senior energy market specialist for Merrill Lynch in New York, argued that OPEC's current ceiling is too low, considering that petroleum inventory levels remain well below normal.

"I don't think the meeting is designed to implement a new policy but to signal to the oil market that they are not going to implode," Rothman said.

Seven of the OPEC members are currently pumping more than their quotas would allow. But Saudi Arabia, the cartel's largest producer and de facto leader, accounted for the bulk of that extra production.

Saudi Arabia, which had been producing only 8.1 million barrels a day in December, is currently cranking about 9.6 million barrels a day, its highest rate in 13 years and about 21 percent above its production limit.

It has ignored its quota because world inventories had dropped dangerously low with the lost production from Venezuela because of labor strife, plus the potential for lost Iraq production when war started.

Days before the fighting began, Kuwaiti officials had announced plans to shut in crude production near the Iraqi border to guard against attack. But fears that Iraq would lash out at Kuwait quickly dissipated. Kuwait is pumping full-out, producing an average of 2.45 million barrels a day this month, 25 percent above its ceiling.

The OPEC producers are concerned about overproduction because the second quarter is traditionally the weakest of the year for oil demand.

Winter is over, while the busy summer travel season has yet to begin. U.S. refineries usually use this period to build inventories, and stocks in the United States are extremely low.

Oil demand was already hampered by a slowdown in the world economy, while the war and the Severe Acute Respiratory Syndrome or SARS epidemic have taken their toll on world travel.

Since the start of the war, crude prices have dropped substantially, as oil traders realized their worst fears -- many oil fields in flames -- were unwarranted.

But the much-feared price crash has not occurred, as it did after the last Gulf War. On Monday, the OPEC basket of crudes fetched an average price of $25.35 a barrel, smack in the middle of the group's desired $22 to $28 price band.

But price hawks like Iran are fearful the United States intends to use Iraq's crude production to hobble the OPEC cartel. Even if other members do not subscribe to such fears, they realize OPEC must make room for the resumption of Iraqi exports.

Vice President Dick Cheney said last week White House officials hope to get Iraqi production back up to 2.5 million to 3 million barrels a day by the end of the year.

Many industry experts believe the new government could be exporting 1 million to 2 million barrels a day by the end of June, Lichtblau said.

But to do that, they'll have to get permission from the United Nations to market the oil.

"The legal issue at the moment is overriding any kind of physical problems," Lichtblau said. "They could start exporting oil, not immediately, but very soon.

During the years of economic sanctions, the U.N. Security Council has controlled Iraq's oil sales through its oil-for-food program.

The United States and Great Britain are poised to ask the United Nations to allow a new government in Iraq to use the proceeds to rebuild the country.

What is unclear is how or when the council will respond.

<a href=www.canada.com>Canadian Press Tuesday, April 15, 2003

CARACAS (AP) - A senior Venezuelan army general said the government of the South American country has proof the United States was involved in a short-lived coup against President Hugo Chavez last year.

Army Gen. Melvin Lopez, secretary of Venezuela's National Defence Council, said Tuesday "proof exists" the U.S. administration was involved in the mid-April putsch. He declined to give further details. "We have the evidence," Lopez said during an interview broadcast by Venezuela's state-run television channel.

Lopez said three U.S. military helicopters were on Venezuelan territory during the coup.

A spokesmen from the Pentagon declined comment on the allegation Tuesday night.

Dissident generals rose up against Chavez on April 11, 2002, several hours after 19 Venezuelans died and over 100 were wounded by gunfire as opposition marchers clashed with government supporters in downtown Caracas.

Loyalists in the military returned Chavez to power two days later.

Following his return, Chavez said "worrying details" had emerged suggesting a foreign country might have been involved in his temporary overthrow.

Chavez said a coastal radar installation had tracked a foreign military ship and helicopter operating over Venezuelan waters a day after his ouster. Chavez did not say which country had sent the ship and helicopter but governing party legislators have accused the United States of helping execute the coup.

The U.S. administration has repeatedly denied it was involved in the coup but acknowledged having held conversations with Venezuelan opposition leaders and military officers prior to the rebellion against Chavez.

A month after Chavez returned, the U.S. Embassy denied allegations U.S. military vessels were in Venezuelan territory.

The only U.S. vessels to approach Venezuelan waters during the coup attempt were two U.S. coast guard ships on a joint anti-narcotics mission with The Netherlands, the embassy said in a news release.

The embassy also rejected allegations by governing party legislators that two U.S. military officials who visited the Fuerte Tiuna military base in Caracas the day before Chavez's ouster were helping coup leaders.

The two officers spent two hours at the base April 11 to investigate information about troop movements, the embassy said. They left hours before Chavez was deposed. Two officers returned to the base April 13 for another evaluation of the situation.

Officials in Washington said they told opponents of Chavez they would not support any unconstitutional activity aimed at removing the leftist leader from power.

Chavez, who has irritated Washington by forging ties with Cuban President Fidel Castro, has criticized the United States for being too slow in condemning the coup when it occurred.

In contrast to most Latin American governments, the United States was sluggish to condemn the coup, initially blaming Chavez for his own overthrow. It later joined members of the Organization of American States in condemning the coup as unconstitutional.

Last week, Chavez commemorated the one-year anniversary of his dramatic return to power by inviting anti-globalization activists to a series of forums in Caracas.

Opposition leaders condemned the celebration, saying it was an insult to relatives of the victims who died in the violence that occurred prior to the military uprising.

<a href=new.stockwatch.com>StockWatch 2003-04-15 22:54 ET - News Release

VANCOUVER, April 15 /PRNewswire-FirstCall/ -- Vannessa is working diligently towards clearing up the legal entanglements of the Las Cristinas Concession and is again forced to comment on statements released by Crystallex which give the impression that the issue of Las Cristina's "Operational Rights" is settled and final and that Crystallex has secured final and binding rights over the deposit.

The following Crystallex statement is quoted from their latest newsrelease:

"Crystallex International Corporation dismissed as self-serving the allegations contained in Vannessa Ventures April 8, 2003 press release. Crystallex's Mining Operation Contract is a final and binding agreement based on the authority and the laws of the Republic of Venezuela and is not open to discussion."

For your information, please review the following publication made by the courts (after Crystallex objected to MINCA's court challenge against the validity of the CVG/Crystallex contract) in the Data Information Bank of the Supreme Court of Venezuela, Sala Politica Administrativa, on MARCH 27, 2003:

Dicisiones dictadas en:68.AA 40-a-2002-00/040: (Translation):

"It is hereby declared, that the application for inadmissibility presented by representatives of the company "Crystallex International Corporation" (CRYSTALLEX) will not proceed and consequently, the legal action is admitted, thus summoning the Corporacion Venezolana de Guyana in the person of its President, citizen Francisco Rangel Gomez and the company Crystallex International Corporation (CRYSTALLEX) in the person of its President, citizen Marc J. Oppenheimer. To serve the summons to the Corporacion Venezolana de Guyana (CVG), it was agreed to commission the First Tribunal of the District of Caroni in the Second Circuit of the Judicial Circonscripcion of Bolivar State."

The Crystallex newsrelease also states: "that the Republic of Venezuela fully supports Crystallex in regards to the Las Cristinas Mining Operation Contract". The company refers to support by the President of the CVG, who signed the Contract, and several members of congress who have traditionally supported Crystallex in its efforts to gain control of Las Cristinas.

Other members of congress however have taken offense to these earlier statements of support and have declared that those members are presenting there own, personal opinion and not the opinion of the Republic nor are they officially authorized to do so.

Quote from the Venezuelan Daily NUEVA PRENSA published on October 23 2002:

"Delegate Mora said, that the statement made by Deputy Luis Salas, president of the Mines and Energy Committee of the General Assembly, on the support offered Crystallex by this institution to develop and operate the gold mines of Las Cristinas in the State of Bolivar, was absolutely false.

"It was unanimously resolved in the National Assembly to reopen the case of Las Cristinas in two separate sessions, starting an investigation to establish why the contract with the previous holder of the contract had been terminated.

He also stated that the exploitation of the Las Cristinas could not be arbitrarily assigned, since it must be done through a bidding process.

Vannessa Ventures Ltd.

CONTACT: Phone Investors Relations, Vannessa Ventures Ltd., 1-888-339-6339

moneycentral.msn.com

As an avalanche of earnings news descends, read between the lines for real clues about the direction of the economy and market. Here are the details that really matter. By Michael Brush If the rush of negative news this earnings season gives you a headache, here’s simple way to ease the pain: Ignore it. Yes, earnings are bad, but so what? We knew they would be. But as you’re ignoring the profit numbers, there are some details you should be paying attention to. To steal a phrase from Defense Secretary Donald Rumsfeld, we'll call them “snippets of intelligence.” Here are the key “snippets” to keep in mind this earnings season when searching for clues about the direction of the economy and the market: Snippet # 1: Watch sales, not earnings Cost-cutting is once again propping up corporate earnings this quarter. So earnings don’t tell us much about the economic trends that hold the key to the future of the stock market. To get the 411 on the economy, it’s best to watch sales trends instead. Sales at S&P 500 companies actually advanced a healthy 10% last quarter. “With numbers like that, to us it doesn’t seem that things are so bad,” says Alex Motola, of Thornburg Investment Management in Santa Fe, N.M. “But we’re looking for follow-through this quarter.” He says anything above a 5% gain for S&P 500 sales is a good sign. “That would be big,” says Motola. “That would tell us that despite all these concerns about the economy and the consumer, companies are still performing.” As for the cost-cutting, it will gain significance in due time. “All the cost-cutting means the earnings leverage will be huge when the economy picks up,” says Timothy Ghriskey, of Ghriskey Capital in Greenwich, Conn. Snippet # 2: See if recovery hopes are postponed -- again Like a promise never kept, that hoped-for economic revival “two quarters from now” keeps getting postponed. Will companies deliver the same bad news this quarter? “I’ll be listening to all the leaders . . . to find out if they see any change in the outlook for the second half of the year,” says Hugh Johnson, chief investment officer at First Albany. He thinks companies will keep postponing the optimism, and the second half will be bleaker than people now expect. One reason: Worries that oil prices may hang in the $25 to $30 range because of supply problems in Venezuela and Nigeria. If he’s right, don’t expect much pizzazz in the stock market -- especially as we move toward the seasonally weak late summer and autumn months. Capital spending forecasts will be key to watch, because companies need to start spending to rev up an economy still supported mainly by the consumer. The three sectors whose capital spending guidance you should follow the most are technology, industrials and basic materials, says First Call’s Chuck Hill. Analysts are currently looking for a healthy 53% gain in third-quarter tech earnings over the prior year, says Hill. And they’re looking for 24% gains in basic materials and 7% gains at industrial companies. To get a sense of whether these forecasts will hold up, listen closely to big players in these fields such as Hewlett-Packard (HPQ, news, msgs), DuPont (DD, news, msgs), Dow Chemical (DOW, news, msgs), International Paper (IP, news, msgs), Alcoa (AA, news, msgs), General Electric (GE, news, msgs), Honeywell (HON, news, msgs) and United Technologies (UTX, news, msgs). If the forecasts fail, expect trouble. “It’s the postponement of Nirvana to the next time level that will really crunch the market,” says market analyst Phil Erlanger of Erlanger Squeeze Play. As for the all-important consumer, major retailers such as Wal-Mart Stores (WMT, news, msgs), Target (TGT, news, msgs) and J.C. Penney (JCP, news, msgs) already release sales data on a weekly or monthly basis. So you won’t need to wait until May, when retailers report quarterly earnings, to get a read on consumer strength. Investors can get some insight on trends in home mortgage refinancing -- a big supporter of consumer spending in recent times -- from conference calls of big mortgage players in the field like Washington Mutual (WM, news, msgs). Snippet # 3: Watch credit quality In a sinking business climate, before many other signs of economic weakness emerge, companies and people often have trouble paying their debts. That’s why Mark Petrie, of Hokanson Capital Management in Encinitas, Calif., will be listening closely to what banks say about growth in nonperforming (read: dud) loans, and reserves against that bad debt. Capital One Financial (COF, news, msgs) and MBNA (KRB, news, msgs) are great proxies for the quality of consumer debt, says Petrie, noting that they're the two largest credit-card issuers in the nation. FleetBoston Financial (FBF, news, msgs) and Bank One (ONE, news, msgs) have big exposure to commercial credit and consumer debt, as well. Regional banks also play a big role. For economic forecasters, what all these banks say about bad debt means more than their earnings. Snippet # 4: Focus on the fear “As always, the key is not what the news is, but how stocks react to it,” says Erlanger. In a twisted sort of way, bad is good. To set the stage for a meaningful stock advance, Erlanger would like to see bad news create deep fear near term -- preferably this earnings season. “Part of the purpose of a bear market is to create a foundation of doubt and that 'wall of worry' that the market can climb,” says Erlanger. “Bearish sentiment is the fuel for a bull market.” To measure investor fear, Erlanger follows a few volatility indices; these are tools that measure anxiety levels by tracking stock-option volatility. Higher numbers mean more anxiety. Erlanger would like to see the Chicago Board Options Exchange (CBOE), Nasdaq Volatility Index ($VXN.X) climb back to the 70-80 range. It recently was around 40. He’d also like to see the CBOE Volatility Index ($VIX.X) in the 50-60 range. It was recently below 30. Even an intraday move into these ranges would be enough, he calculates, to produce a "healthy" base of fear. Short selling also has to increase. Snippet # 5: See if guidance keeps flowing High-profile companies from McDonald’s (MCD, news, msgs) and Sun Microsystems (SUNW, news, msgs) to AT&T (T, news, msgs) and Mattel (MAT, news, msgs) have suspended earnings guidance. Take it as a bad sign if more companies follow their lead. “Let’s face it, if the guidance were good news, they would give it,” says Erlanger. No one formally tracks the number of companies suspending guidance. So you’ll have to rely on anecdotal reports. Snippet # 6: Watch transportation stocks As arcane as it sounds, the behavior of transport stocks such as CSX Corp. (CSX, news, msgs) in the rail realm, Airborne (ABF, news, msgs) in air freight and Continental Airlines (CAL, news, msgs) can tell you a lot about whether we are headed toward stronger economic growth. That’s why the Dow Jones Transportation Index ($DTX.X) will be watched closely by John Hussman, an economist whose Hussman Strategic Growth Fund (HSGFX) has advanced an impressive 47% since its launch in July 2000. The results of transport companies -- and how their stocks trade -- tell you a lot about the outlook for the economy for three reasons, says Hussman. First, of course, transport companies link producers and customers. Second, they use a lot of energy. So how their stocks behave can give you a read on the market’s outlook for energy prices. Third, transport stocks -- especially the airlines -- have a lot of debt. So how these stocks act tells you a lot about the market’s attitude to bankruptcy and loan-default risk. Since markets anticipate news, you’ll see transport stocks advance ahead of clear signs of improvement in any of these areas. But early hints of improvement may flow out in conference calls by transport companies. “If we were to see strength in the transports, particularly if it were accompanied by a decline in oil prices, that would be a fairly good signal that the market climate has shifted to a more constructive tone,” says Hussman. Snippet # 7: Seek proof that the war really did hurt business About 80% of the companies that used this excuse were probably fibbing, figures John LaForge, a money manager with the Phoenix-Hollister Value Equity Fund (PVEAX). Some, though, really did see orders decline because of uncertainty during the war in March. You’ll be able to spot them because in their conference calls they’ll say orders picked up again in April. LaForge says this will play out in areas where fundamental demand is strong but where buyers had put off orders to hit their first-quarter profit targets. A likely hunting ground: companies that sell equipment used in video on demand, which is becoming more popular among customers of cable companies such as Comcast (CMCSK, news, msgs) and Cox Communications (COX, news, msgs). Phoenix-Hollister has a position, for example, in Concurrent Computer (CCUR, news, msgs), which sells servers used in video on demand. Says LaForge: “In March their customers told them, ‘We don’t want to buy now because we want to make sure we make our numbers, but come April we are going to buy.’” You’ll know for certain April 24, when Concurrent releases its first-quarter earnings. It’s no sure thing that concerns about geopolitical tensions are behind us. “Historically, the war effect lifting the market is based on the euphoria of seeing peace,” says Ghriskey. “But if the mop-up effort in Iraq becomes ugly, and if North Korea becomes ugly, then there are more problems ahead of us in the economy and the market.”

At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column.

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Tuesday, April 15, 2003 By: Bob Dang

VHeadline.com reader Bob Dang writes: Hi, I'm a Canadian University student, who just wanted to say that i think your President Hugo Chavez is a great man.

I just watched an Irish documentary called: Chavez inside the coup.

If you have not seen this documentary, I highly recommend it, for in it lies the truth.

I was wondering if you could recommend it to be played on the state-owned channel in Venezuela (channel 8). I really hope that Venezuelans come to realize that Chavez is for the people ... he wants to distribute the wealth back to where it belongs: you.

These social reforms require a vast amount of capital ... capital that can only be gained with the new hydrocarbon bill coming into effect (i.e. the dismantling of PDVSA).

• I hope your country finds the stability, security and riches that it's people deserve.

Have a good day and thank-you for reading my e-mail.

Bob Dang freshjive112@rogers.com

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