Wednesday, April 23, 2003
With the War Largely Over, OPEC Fears Oil Price Drop
Posted by click at 4:55 AM
<a href=www.nytimes.com>The New York Times
April 21, 2003
By NEELA BANERJEE
When the Organization of the Petroleum Exporting Countries met five weeks ago to set its spring export levels, it faced an uncertain world, one clouded by the prospect of a war in Iraq. When it meets again on Thursday, it will face more uncertainty now that the main fighting is over.
Before the war, most of OPEC's members pumped oil at maximum levels to make up for an expected curb in Iraqi exports — something that in fact occurred — and prices moved higher. They had climbed through the winter, not only in expectation of war but also because of political strife in Venezuela and ethnic clashes in Nigeria, and then swung back and forth on news from the battlefronts in Iraq.
On Thursday, the last trading day before the Easter holidays, the price of crude oil rose $1.37, or 4.7 percent, to $30.55 a barrel on the New York Mercantile Exchange.
Still, OPEC worries that if it does not scale back its extra production soon, oil prices will fall below $20 a barrel, beneath the group's ideal price range of $22 to $28.
Despite the currently robust prices, OPEC is concerned in large part because of a belief among oil traders, shaped by optimistic forecasts by the United States government, that Iraqi exports could resume in weeks. Combined with the additional OPEC production, this reasoning goes, that could create a glut.
Yet most oil experts agree that it is too early to tell when Iraqi exports might return and at what quantities, given the tangle of technical, financial and diplomatic issues that must be sorted out by the American authorities now running Iraq. It is not even clear who might represent Iraq, an OPEC member, at this week's meeting in Vienna or whether it will even remain in OPEC, a seemingly distant issue that already concerns other members.
Add to the mix the weak global economic recovery and the economic effects of the respiratory illness SARS, industry experts say, and it becomes difficult for OPEC to make a sound decision about how much oil to pump.
"It's very hard now to look at the supply-demand balance," said Mehdi Varzi, president of Varzi Energy, a consulting firm in London. "The picture is so mixed up with what's happening in the Middle East still."
Representatives from the Army Corps of Engineers responsible for repairing oil fields in Iraq have said that some oil exports could start flowing again in weeks. Kurdish leaders who entered the northern oil region near Kirkuk with American soldiers have predicted the same.
But it remains unclear who has the right to export Iraqi oil. Under United Nations sanctions, Iraq can export its oil only through the oil-for-food program, and the Bush administration is pressing the Security Council to change that agreement so the United States can sell Iraqi oil. When this might happen is unclear.
Also, some Kirkuk fields have been so efficiently ransacked that managers there say it may be several months before they can produce enough oil for export. And it remains unclear who will pay to replace what was looted from Kirkuk to make that possible.
Some OPEC leaders, like Algeria's oil minister, Chakib Khelil, say the group will most likely rein in extra production to the official quota levels of 24.5 million barrels a day. It is now producing nearly 26 million barrels, according to recent estimates by the Middle East Economic Survey. And Venezuela and Nigeria have resumed degrees of production.
Such a cutback might be enough to calm a market in which many oil traders and buyers think demand will be slack because of the sluggish world economy. In addition, the SARS outbreak has already slowed economic growth in Asia and led to a drop in demand for jet fuel by several hundred thousand barrels a day because of a decline in tourism, said Lawrence J. Goldstein, president of the Petroleum Industry Research Foundation in New York.
Mr. Goldstein warns that there could be perils to a decision by OPEC to reduce output below 24.5 million barrels a day. Inventories of crude oil and gasoline were very low coming into the spring, and they are being replenished rapidly now by the increased OPEC output. But if that process stops, oil and gasoline prices may again rise as the United States, the largest oil consumer by far, enters the summer driving season.
Who will speak for Iraq on Thursday, and try to answer the unanswered questions, remains a mystery. There is no Iraqi government and the United States has yet to announce the structure of an interim oil ministry. Already, some OPEC members and many people in the Middle East worry that under American influence, Iraq could soon leave OPEC to pump a lot of oil on its own.
But Mr. Goldstein contends that Iraq can do that and stay in OPEC. While its oil output was determined by United Nations sanctions, the rest of OPEC took its market share, produced oil in its stead and pocketed the extra revenue.
Now, Mr. Goldstein and others say, Iraq might tell OPEC that it will pump as much as it can to make up for those lost years of revenue. Before the war, it produced about 2.8 million barrels a day and exported, legally and otherwise, about two million barrels of that.
"Iraq will produce what it's capable of producing," he said, "whether it stays in OPEC or not."
Rebel colonel 'under arrest'
News Interactive
From correspondents in Caracas, Venezuela
21apr03
POLICE in Venezuela have reportedly arrested one of 14 military officers who publicly opposed President Hugo Chavez last year.
Army Colonel John Giussepe Piglieri was arrested in a shopping centre in the city of Maracay, north-east of Caracas, his sister-in-law said.
Nardick de Diaz told the Globovision network he was transferred to an army base in the city.
The colonel was one of 14 officers that declared themselves "in rebellion" against the Chavez government in October, and was among officers who camped at the Plaza Altamira, a centre of opposition activity during a lengthy general strike that attempted to oust Chavez.
The only other officer arrested for his open opposition to Chavez, a general with the militarised National Guard police, Luis Alfonso Martnez, has been under house arrest since December 30.
Piglieri faces charges of rebellion and dereliction of duty for abandoning his command.
Inquiry Into a Deadly Venezuelan Rally Is Stalled
<a href=www.nytimes.com>The New York Times
April 21, 2003
By JUAN FORERO
CARACAS, Venezuela, April 20 — Within hours of his death on April 11, 2002, Jorge Tortoza became a martyr for the opponents of President Hugo Chávez. So did many of the other 18 people killed after gunfire erupted here during a sprawling antigovernment march, a confused explosion of violence that led to the brief unseating of the president.
A year later, however, Mr. Tortoza's relatives say they still do not know who is responsible for his shooting. Families of most of the other victims express similar frustration, despite aggressive efforts by both the government and the opposition to cast blame on the other.
"If it is the government, or the other side — I can't say," William Tortoza, 35, a veteran police officer and Jorge's younger brother, said as he pointed out the street corner where his brother fell. "Sincerely, nothing has been done to investigate."
By most accounts, the investigation into the events, the worst political violence in Venezuela in a decade, is indeed in a shambles. Homicide charges against six suspects have been dropped. Other suspects have fled the country. No one has been jailed.
In the aftermath of the shooting, the opposition immediately claimed that the government had fired on the hundreds of thousands of protesters who marched on the Miraflores Palace, the offices of Mr. Chávez. His allies claimed that the deaths were a central part of a carefully orchestrated coup by his enemies.
Though the investigation languishes, it is increasingly clear that the gunfire came from both sides. Investigators and human rights groups say the National Guard troops loyal to the government fired, as did Metropolitan Police officers opposed to Mr. Chávez. Various other gunmen — some have been identified in videos, others are still unknown — also fired shots, say witnesses, investigators and political analysts.
The victims, it is now certain, also came from both sides, with the opposition and the government each losing seven supporters, though both camps continue to claim more victims. Five others were not members of either camp, including Mr. Tortoza, a 47-year-old newspaper photographer whose specialty was crime scenes.
Human rights groups and political analysts place much of the blame for a lack of progress in bringing those responsible to justice with the office of the attorney general, Isaías Rodríguez, who was once the vice president. His ties to the president have compromised his independence, they say.
Ana María Sanjuán, director of the Center for Peace and Human Rights at the Central University of Venezuela, said both sides had manipulated the investigation. Ms. Sanjuán, who is working with 48 human rights groups to press for an impartial investigation, said she had come to the conclusion that neither side wanted to see a resolution.
"Both political sectors have used April 11 in a completely unacceptable way for political ends," she said. "Both sides have tried to say, `I have more of my dead here and I'm most affected.' This has helped shelter those responsible and hindered the investigation."
Mr. Rodríguez, the attorney general, acknowledged that the investigation had been hampered, with crime scene evidence lost and witnesses avoiding investigators. But he blamed the problems on those with "political positions" and independent investigators hired by some families.
His office says that 18 gunmen have been identified, among them 8 police officers, 5 National Guard troops, and 6 progovernment militants firing from the Llaguno Bridge just two blocks from the presidential palace.
In seven cases, investigators can match the victim to a shooting suspect, he said in an interview. He said there were also seven gunmen who may have fired from a downtown building, though they are now believed to have fled the country.
Yet no suspect faces serious charges. Homicide charges against four suspected progovernment gunmen who fired from the bridge, including a city councilman, have been dropped at the court's behest for lack of evidence.
"Those are promising statements by the attorney general, but they're just statements," said Eric Olson, who oversees Amnesty International operations in the Americas. "It's high time that the information be turned into prosecution. Probably they are investigating some, but I think until there's actual justice for the victims and their relatives it's insufficient."
To people like Mohamad Merhi, 51, the deaths and the investigation are a travesty.
David Rochkind/Polaris for The New York Times
The investigation into the killing of 18 people, including Mohamad Merhi's son, during an antigovernment march in Venezuela last year is in a shambles.
His son, Jesús Capote, 18, was marching with opposition protesters when a bullet struck his head and killed him. Now, Mr. Merhi is the most visible advocate for opposition families who lost relatives in the shootings.
Deeply distrustful of the attorney general, Mr. Merhi has instead counted on a group of retired police officers who are allied with the opposition movement to investigate the deaths.
"I know the truth," Mr. Merhi said, insisting that his son was killed by a progovernment gunman. "I am looking for justice. I know there was an ambush, and I know Chávez gunmen were shooting at our people."
The opposition has played to such anger. In the carefully choreographed rallies, like one on the anniversary of the deaths, images of dying protesters are shown on big-screen televisions to the accompaniment of somber music played over huge loudspeakers.
The government, too, has used the deaths, as a symbol of opposition treachery. It has helped organize a group for the families of victims, Association of Victims, which has an office in a downtown building.
Inside, posters of Che Guevara, the revolutionary icon, hang side by side with the Venezuelan flag and advertisements celebrating Mr. Chávez's revolution. Government supporters wounded in the shootings, as well as the relatives of people killed, meet here daily to discuss the cases.
"We are working to make sure that everything is cleared up," said Silenia Morena, 38, whose husband, César Matías Ochoa, was killed. "The dead were not just in the opposition. Yes, they had some. But the majority were from the government side."
But the bitterness extends to those on both sides, including Jorge Tortoza's relatives. Using his connections in law enforcement, William Tortoza said he had badgered investigators and judicial officials, but had come up with few answers.
"I am tired of going and asking questions and looking for answers," he said.
Meanwhile, the family has tried to keep Jorge Tortoza's memory alive. His mother, Rosa Tortoza, 71, visits his grave each week, laying flowers, gently crying and controlling the rage she said has consumed her since his death.
"I would like to clear this up because I want peace of mind," she said softly as she visited the grave on a recent day. "My son was beautiful, and he left behind a beautiful 3-year-old daughter. He was a father and brother and son to all of us."
Gas prices plummet in the United States
Posted by click at 4:25 AM
in
oil us
CNN
Sunday, April 20, 2003 Posted: 5:59 PM EDT (2159 GMT)
CAMARILLO, California (CNN) -- The average cost of a gallon of self-serve regular gasoline continues to drop, falling slightly less than 6 cents during the past two weeks, according to a nationwide survey released Sunday.
The average price fell 5.73 cents, to $1.61, between April 4 and April 18. It marks the second straight drop in gasoline prices in the bi-weekly survey, which prior to that had been on the increase since last November, said Trilby Lundberg, publisher of the Lundberg Survey.
In the past month, the price of a gallon of self-serve regular gasoline has dropped 11.8 cents, from $1.73, a "dramatic decline," Lundberg said. This year's high of $1.73 was the survey's highest ever, not adjusting for inflation.
Lundberg credited the price cut to drops in the cost of crude oil since the beginning of the war in Iraq, which continue to be felt at the pump.
The price of crude oil was at $34.93 a barrel on March 17, the day the president gave Iraq 48 hours to give up its alleged weapons of mass destruction or face war, she said. By April 17, the price was down to $30.55, she said.
Crude oil prices probably will continue to decline as oil production in post-war Iraq, Venezuela and Nigeria continue to rebound, Lundberg said.
All that could change when OPEC meets Thursday to discuss whether to curtail crude oil production in light of decreased demand during warmer weather and the expectation of the resumption of Iraqi oil production, Lundberg said.
At $1.34 per gallon, Atlanta motorists paid the least in the nation; San Francisco Bay Area drivers paid the most, at $2.07.
Here are some other prices per gallon of self-serve regular gasoline:
• Baltimore: $1.61
• Charlotte, North Carolina: $1.48
• Chicago: $1.63
• Hartford, Connecticut: $1.67
• Salt Lake City: $1.60
• St. Louis: $1.39
• Seattle: $1.74
Earth Day equation: drug abuse = environmental abuse
The Christian Science Monitor
Commentary > Opinion
from the April 21, 2003 edition
By Paula Dobriansky
WASHINGTON – In recent decades, we've become increasingly aware of the dire global environmental consequences of destruction of the earth's tropical forests - shrunken habitat for animal species, lost biodiversity, more soil erosion, and fewer "carbon sinks" to absorb greenhouse gases.
There are a variety of ways one can assist in arresting tropical forest destruction, such as supporting forestry conservation or enhancing markets for "rain forest friendly" products such as shade-grown coffee. Recycling is also helpful.
monitortalk
But if you want to do one thing for Earth Day - Tuesday, April 22 - to conserve forests and even reverse deforestation: stay away from cocaine and heroin.
The strong link between illegal drug use and tropical forest destruction became obvious to me when I visited Colombia last year for the inauguration of Colombia's President Alvaro Uribe and discussed the drug trade with several members of his cabinet.
To cultivate coca and avoid being detected by law enforcement, farmers need to clear fields in fragile tropical forest areas, most often by slashing and burning. Colombia reports that, during the 1990s, more than 3 million acres of rain forest - an area larger than Yellowstone National Park - were cut for the cultivation of opium poppy and coca.
Similarly, Peru estimates that coca cultivation has caused the loss of 5.7 million acres of rainforest - a quarter of its total deforestation.
Deforestation is only one consequence of coca and poppy cultivation. Highly toxic insecticides and herbicides are used indiscriminately by coca and poppy growers in Colombia and Peru and can persist in the environment and harm a variety of wildlife. These products are used at rates that exceed the manufacturers' recommendations by individuals with no training or personal protection. They're often stored in or near the farmers' homes or food supplies, exposing them and their families to hazardous levels of these substances.
Once the coca and opium-poppy crops are harvested, coca leaves and poppy latex are mixed with more industrial chemicals, including sulfuric acid, acetone, potassium permanganate, and gasoline, to make cocaine base and heroin. The Colombian government estimates that in 2000, gasoline, in amounts equivalent to three days of gas consumption in California, were used for coca-leaf processing.
And in the middle of the forest where the processing pits and drug labs exist, you will not find toxic waste-management systems; those deadly chemicals are haphazardly dumped on the land and into the streams and rivers that supply drinking water for local populations.
In the case of Colombia, the drug trade has yet another devastating environmental consequence: It provides funding for the violent activities of three illegally armed groups, all of which are on the US list of known terrorist organizations: the National Liberation Army, the United Self-Defense Forces, and the Armed Revolutionary Front of Colombia.
Illegally armed groups also regularly bomb Colombia's oil pipelines. One pipeline built in 1986, for example, has suffered 700 attacks in which a total of 2.5 million barrels of crude oil were spilled along the Columbia-Venezuela border. That's roughly 10 times the amount of crude oil dumped into Prince William Sound in the 1989 Exxon Valdez disaster.
Unfortunately, the US remains the world's No. 1 consumer of the cocaine that originates in the Andes. And Americans consume virtually all of the heroin originating in that region.
A reduction in consumption of these illegal drugs in the US alone would cause a drastic decline in their production in the Andes, slowing deforestation and lessening pollution of the rainforest.
As concerned citizens have Earth Day discussions about how to stop global warming and save the earth's rainforests, they need to think about this linkage that may not be so obvious on the streets of the US. Truly concerned citizens also need to think about it the next time they are tempted to snort cocaine or use heroin, even if it's "just for fun." It's not just their own bodies they'll be polluting.
• Paula Dobriansky is the US undersecretary of State for global affairs.