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Last modified : 21 June 2003 1557 hrs (SST) 0757 hrs (GMT)

Total oil production by the OPEC cartel dropped 212,000 barrels per day to 26.69 million bpd in May, the Middle East Economic Survey reports in its Monday edition.

The industry newsletter said without Iraqi production, output fell 362,000 bpd to 26.39 million bpd last month.

Barring Iraq, Nigeria and Venezuela, all members of the Organisation of Petroleum Exporting Countries saw a small decline.

Iraq's production, recovering from war, doubled to 300,000 bpd in May, but supplied only the domestic market, awaiting the resumption of exports, the Cyprus-based specialists say.

Caracas and Lagos both continue to boost production to normal levels of before the Venezuelan general strike and ethnic fighting in Nigeria, MEES says.

"MEES sources indicate that Iran's output comprised 2.11 million bpd of exports and deliveries of 1.45 million bpd to domestic refineries," the weekly adds.

On Friday, oil prices topped US$30 a barrel in New York, as traders reacted to an earlier report showing lower OPEC production.

New York's benchmark light sweet crude contract for July delivery was up 86 cents to US$30.82 a barrel in late deals.

CounterPunch By HAROLD A. GOULD

The great question that lingers in the aftermath of the war America waged against Iraq is: Where are the weapons of mass destruction over which the war was allegedly fought? This is clearly the topic of the moment. A recent Washington Post article (June 13th) is the latest of numerous articles and commentaries which suggest that hard evidence for the existence of WMDs was at best meager and at worst mostly speculative. In the end, the most that has been found are two tractor trailers that might have been mobile chemical laboratories (although a recent Guardian article says they were for inflating hydrogen balloons used for artillery deployments), and a scattering of rusty barrels that might have or may not have contained weaponizable substances. Such slim pickings do not a massive stockpile of WMDs make! Especially when none of the bulky and hard to conceal delivery systems needed to launch toxic or nuclear attacks have ever been found. If subsequent investigations fail to reveal anything more tangible than this--i.e., if it turns out that the UN inspectors whose judgements the Bush administration so cavalierly dismissed were in fact accurate, and that Saddam's assertions that Iraq no longer possessed WMDs were true--then Mr. Bush and his neoconservative entourage will have much to answer for down the road.

The Bush administration clearly knows in private that their original rationale for waging preemptive war on such a massive scale was based upon enhanced intelligence data. So much so that revelations of its extent may yet bring down Tony Blair's prime-ministership in England. This is attested by the fact that the White House spin-doctors, including Mr. Bush himself, are subtly--or not so subtly?--altering the premises of their original scenario. They are now flooding the airways and the printways with a torrent of claims that, after all, it doesn't really matter if the smoking gun (or should we say, the noxious odors!) which was their original justification for undertaking a war adamantly opposed. by the international community has never been found. It is sufficient, they are asserting, that Saddam Hussain was a bad guy who constituted a "threat" to his neighbors and a menace to his own people.

This is a point with which some us can agree. One devoutly wishes that if preemptive war were going to be waged its primary motivation was to liberate an oppressed people rather than this being a retrospective byproduct of a war which its perpetrators themselves had little intention of waging for any sort of humane or compassionate reasons. Obviously, there is no country in today's world, superpower or not, that will blanketly employ this criterion for determining who's good and who's bad, and who is deserving of a preemptive American strike and who is not. It could be after all just as well be applied to dozens of countries in every part of the globe! Why not North Korea? Why not Iran? Why not Venezuela? Why not even China, for that matter, considering their human rights record? The answer, of course, is self-evident. In international politics, idealism has precious little to do with who gets singled out for the moral retribution over their human rights record! The decision to wage war is rarely by shimmering morality; it is determined by naked self-interest and by what you think you can get away with. Certainly this was the case with Iraq.

Apart from the apparently wide gap between truth and wishful thinking which fueled the Iraq campaign, there is, however, a further, greater irony in all this. It is: Why Saddam, if indeed he no longer possessed the stores of WMDs which the Bushies said he did, was he willing to prevent this fact from becoming known to the satisfaction of Washington and the UN and thus avoid reaping the wild wind? Why, in short, was Saddam willing to risk the destruction of his regime and his country essentially in the name of a quixotic bluff?

The answer probably lies in a mixture of factors, and may contain some insights into other, similar crises that may come down the road.

One factor that might be taken into consideration is Saddam Hussein's personal mind set. He was always a political gambler who had enjoyed a remarkable run of luck. "The strongest suggestion that Hussein had a substantial WMD program," notes Richard Cohen (Washington Post, June 17th) was his refusal to come clean. But it is also possible that he wanted the world -- particularly his neighbors (Iran) and his domestic opposition (Shiites, Kurds, etc.) [not to mention the United States] to think that he did." He had survived the onslaught mounted against him in 1991 by President Bush's father when nothing seemed more improbable. In the intervening decade, Saddam adroitly held UN inspectors at bay; endured a missile strike ordered by President Clinton in 1998 after he kicked the inspectors out of the country, successfully circumvented economic sanctions, and sustained his image on the Arab street as a revolutionary Islamic hero. In the face of the major divisions that emerged among the great powers over the American call for an Iraq crusade, it would not be surprising if Saddam believed that he could remain intransigent, dodge the bullet one more time, and retain his military-economic apparatus intact. Such are the instincts of dedicated gamblers, especially when driven by ideological certitudes!

Another related factor which addresses Saddam's staying power was his apparent belief that history if not the gods were in his corner. He depicted himself as the modern incarnation of Saladin, the great medieval warrior whose military victories over the Christian world laid the foundations of an Arab imperium that eventually stretched from India to the Atlantic Ocean, from Central Asia to North Africa, and the Balkans. One must never dismiss the power of apocalyptic fantasies in the hands of charismatic political dreamers. History is littered with their exploits, and their tragedies, ranging from the Mahdi in the Sudan to Wovoka among the American Plains Indians. In Saddam's case his imageries and his short-term successes won him a wide following in the Arab world and fed his illusions of omnipotence and invincibility. This illusion of political omnipotence undoubtedly contributed to what can only be characterized as a fool-hardy gamble that he could somehow survive even if he could not avoid a direct military confrontation with the world's only superpower.

It is in this context that some observations which American CIA Director, George Tenet, made in a 2000 public briefing. He spoke of what he believed to be the driving force behind Saddam's pursuit of chemical weapons. Iraq, he said, sought a bioweapons capacity "both for credibility and because every other strong regime in the region either has it or is pursuing it."

If the WMDs are never found, then what has taken place must be understood as one of the more bizarre manifestations ever witnessed of mutual deceit being pursued on a truly international scale. On one side we have the Bush administration, determined to wage war upon Iraq and Saddam Hussein for a host of genuine and spurious reasons, willing to distort and embellish the intelligence data to whatever degree necessary to justify it, and prepared to take whatever sweat might follow once the dimensions of the deception become public in the aftermath.

On the other side we have the Saddam Hussein regime, willing to risk everything for the sole purpose of clinging to a mythologized political image of itself as the premier radical Arab power with the capacity and the guile to successfully defy the authority both of the American superpower and the United Nations.

If the facts as we currently know them hold up, the Iraq war will undoubtedly take its place as a classic case of a symbiotically intertwined danse macabre between two nation-states whose addiction to the trappings of political power and jingoistically driven self-importance outweighed all considerations of measured reflection on the costs and consequences of impulsive political behavior. Thousands of dead and wounded innocents and billions of dollars worth of ruined infrastructure are the price that has been paid for the free play of this dueling exercise in over-inflated national egos.

Harold Gould is a Visiting Scholar in the Center for South Asian Studies at the University of Virginia. Email: 102062.477@compuserve.com.

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Mark Jacobs A Serious Conversation: a Former Foreign Service Officer on Diplomacy in the Age of Bush

Alfredo Castro Bloodbath in Colombia: The Army and the Death Squads

Saul Landau Lying, Flag Waving and Redefining Conservative Values

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<a href=www.hipakistan.com>Hi Pakistan! US President George W Bush and his Brazilian counterpart have emphasised their countries' common interests despite opposing each other over Iraq and some trade matters.
Luiz Inacio Lula da Silva - commonly known as Lula - was visiting the White House, the first foreign leader who opposed the US-led war on Iraq to do so.

Mr Bush said the relationship between the countries is "vital, important and growing".

The two men announced a series of joint projects ranging from energy to business development in Brazil and fighting Aids in Africa.

"Brazil is an incredibly important part of a peaceful and prosperous North and South America," Mr Bush said as he received Lula for an Oval Office meeting.

The BBC's Steve Kingstone, in Washington, says the left-wing former trade union leader is not a natural political ally of Mr Bush.

He has maintained warm relations with Cuba's Fidel Castro, long a thorn in America's side.

But since taking office, Lula has impressed Washington with a combination of economic discipline and an ambitious long-term programme to combat poverty in Brazil, our correspondent says.

Mr Bush said: "This relationship is a vital and important and growing relationship.

"On a personal prospective I am very impressed by the vision of the President of Brazil. He not only has a tremendous heart, but he has got the abilities to encourage prosperity and to end hunger."

For his part, Lula spoke of a great partnership but it should, he said, be based on sincerity and trust going beyond a few occasional photo opportunities.

Confrontations

The dynamic between the two men is probably the key to this relationship for the next few years, our correspondent says.

Together the two governments are chairing negotiations towards a hemisphere-wide free trade agreement scheduled to come into force in 2005.

The United States is the largest investor in Brazil, with 400 firms and investments of $30bn (£20bn), while Brazil exports some $15bn (£10bn) worth of goods to the US.

With a population approaching 175 million, Brazil is the second largest country in the Americas, after the US - and South America's largest economy.

Lula would like to ensure greater access for Brazil's huge agricultural sector to US markets before agreeing to any trade deals.

Meanwhile, American policymakers are increasingly looking to Brazil for help in resolving some of the most difficult issues between the hemispheres.

These include the confrontation between US companies and Venezuela's Hugo Chavez, and the drug-trafficking issues in the Andes states.

The Brazilian president is accompanied by no fewer than 10 cabinet ministers, in the biggest Brazil-US summit since World War II when President Frank D Roosevelt persuaded Brazil to join the war effort.

Fri June 20, 2003 07:58 PM ET (updates with Lula, State Department official comments)

By Randall Mikkelsen

WASHINGTON, June 20 (<a href=reuters.com>Reuters) - U.S. President George W. Bush, the son of an ex-president, and Brazil's Luiz Inacio Lula da Silva, his country's first president from the working class, agreed on Friday to seek closer ties despite deep differences.

They issued a joint statement after their first face-to-face talks since Lula was sworn in on Jan. 1, saying their governments will have regular, high-level, consultations on issues from counter-terrorism to aid for Africa.

"The United States and Brazil resolve to create a closer and qualitatively stronger relationship," it said.

The statement made no mention of the U.S.-led war on Iraq, which Lula strongly opposed, and Brazilian officials said the matter was not discussed.

Warming ties between the two have come as a surprise, and reflect U.S. hopes Brazil can be a stabilizing influence in Latin America as its democracy movement has been strained.

Most of the region suffered a recession in 2002, with Venezuela and Argentina hard hit by economic slumps and political upheaval.

Speaking to reporters after the White House meeting, Lula said relations between the hemispheric giants were poised to enter a new era, saying, "I think this meeting can establish a new framework in Brazil-United States relations."

Lula told Bush he wanted Washington to help fund infrastructure investments in South America. He said the region needed better ports, roads and railways.

Asked if Bush was open to the idea, Lula said: "I think he is going to help."

A State Department official, who was present, said Bush and Lula hit it off well. "This meeting could not have gone any better. I can't tell you what a positive atmosphere there was," the official said.

The countries announced joint initiatives including U.S. support for Lula's anti-hunger program in Brazil, cooperation on energy and fighting AIDS in Africa.

"Without any question, I believe that we can surprise the world in terms of the relationship between Brazil and the United States," Lula told reporters in the Oval Office, Bush at his side.

Brazil and the United States co-chair the Free Trade Area of the Americas talks, seeking a hemisphere-wide free trade zone by January 2005. The joint statement reaffirmed the leaders' aim to conclude negotiations on time.

Lula sounded an optimistic note on FTAA, saying, "I am convinced that we have the conditions in place to break down all the barriers, if we are patient and perseverant."

He repeated several times his invitation to Bush to come to Brazil and Bush said: "Yeah, I really want to."

(With additional reporting by Pablo Bachelet and Jonathan Wright)

Sat June 21, 2003 10:35 AM ET By Joseph Giannone

NEW YORK (<a href=reuters.com>Reuters) - ChevronTexaco Corp. CVX.N will put dozens of oil and gas properties on the block as merger-related restrictions on asset sales expire this fall.

At the same time, a comprehensive business review by the company is expected to trigger a massive write-off in its overseas refining and marketing businesses.

Oct. 9 marks the two-year anniversary of the combination of Chevron Corp. and Texaco Inc. -- and the starting point for sweeping changes by the second-largest U.S. energy company. In August the company will unveil plans to divest assets and boost returns from exploration and production.

Some analysts say the company also may announce changes to its international refining and marketing business, comprised of its CalTex business in Asia and Africa and Texaco's assets in Europe. Changes may include the shutting down or sale of some assets.

Those assets have deteriorated in value since the merger, analysts said, and could result in a write-down of as much as $3 to $5 billion as early as this year.

"These assets are severely over-capitalized and of a quality and of a competitive nature that leaves something to be desired," said analyst Mark Gilman of First Albany, who has a "sell" rating on ChevronTexaco shares.

A spokesman said the company won't comment on its plans until its investor meeting in August, although ChevronTexaco executives have said sales would be on par with the $1 billion to $2 billion in assets sold annually before the merger.

Because ChevronTexaco used pooling of interests accounting for the merger, it has not been allowed to sell significant assets. At the same time, rivals have shed properties in North America and the North Sea, freeing cash for reinvestment in more promising regions, such as Southeast Asia, Africa and Russia.

Now, with those restrictions soon to expire, analysts said, the company will announce plans to shed properties in the United States, Canada, the North Sea and the Gulf of Mexico. Even in emerging hot spots like Indonesia, ChevronTexaco may divest some mature fields.

ChevronTexaco might also pull the plug on holdings in Colombia, Venezuela, Argentina and Brazil, where the company may lack sufficient scale.

This year the company has announced minor sales, including the disposal of 100 North American properties. ChevronTexaco also announced the sale of its stakes in a Papua New Guinea venture and a refinery in El Paso, Texas.

"It looks like the company may bite the bullet and take some write-downs," John Herold analyst Lou Gagliardi said. "They're being forced to take a hard look at their overweight exposure in the Far East."

That means even CalTex, formed by the two companies in 1936, is at risk. The division has 10 refineries and service stations in 60 countries across Asia, the Middle East and Africa, but many of its markets suffer from a glut of refining capacity and sluggish demand growth.

So, as painful as these steps may be, the company needs to convince investors it is taking all necessary steps to boost financial performance, analysts said.

"If the changes are seen as half-hearted, or not doing enough to reposition the company and boost profitability, the market will be disappointed," Herold's Gagliardi said.