Reuters, 05.08.03, 3:10 PM ET By Elizabeth Fullerton

MEXICO CITY (Reuters) - Mexico's decision to orient its oil policy towards the United States and away from the OPEC cartel is seen as more about mending bruised ties with its main trading partner than a fundamental policy shift.

Mexican Foreign Minister Luis Ernesto Derbez said on Wednesday during a visit to Washington that the linkage between Mexico's oil policy and OPEC production decisions will weaken as North America becomes more of a single energy market.

"I think part of this is fence-mending with some of our natural trading partners who chose publicly and visibly to go their own separate ways with the war (on Iraq)," said Larry Goldstein, President of the Petroleum Industry Research Foundation in New York.

Mexico annoyed the United States, which buys 90 percent of its exports, by refusing to back a U.S.-led attack on Iraq.

Non-OPEC Mexico is the eighth biggest crude producer in the world and one of the top four oil suppliers to the United States, along with Saudi Arabia, Venezuela and Canada.

Since 1998 Mexico has cooperated with the Organisation of Petroleum Exporting Countries in raising and lowering supply to stabilize global oil prices.

Mexico had curbed its exports since the start of 2002 in cooperation with OPEC to boost prices from late 2001 lows but as of February this year it raised its export platform to 1.88 million bpd to compensate for lost supply from a Venezuelan strike and curb rising oil prices as a war on Iraq loomed.

"(Derbez's comments) could be taken as a message that Mexico is in a better position to increase its share of the U.S. market because of the situation with Venezuela and other global events," said Lisa Pearl, Associate Director at Cambridge Energy Research Associates.

Mexico in March exported an average of 1.88 million barrels per day (bpd) of crude on average output of 3.317 million bpd. Mexican energy officials have said the nation is currently close to its export and production capacity limit.

PRAGMATISM RULES

Mexico has something of a tightrope to walk between cooperating with OPEC to keep oil prices -- and hence export revenues -- buoyant and not upsetting the United States or hurting its economy which is closely linked to Mexico's.

"Where they fit in this continuum between close ties with a consumer like the U.S. and close ties with other producers like OPEC depends a lot on price level," said Sarah Emerson, Managing Director at Energy Security Analysis Inc in Boston. "I think if the (oil) price fell to $10 (a barrel) again Mexico would line up with OPEC to try to reign in production worldwide. If the price is $30 Mexico is certainly not going to talk about its alliance with OPEC," she added.

Oil prices on Thursday were trading around $27 a barrel in New York. Prices have fallen since OPEC's surprise decision two weeks ago to raise its official output limits while claiming a large cut in actual supplies.

Mexico, which has over the past year mirrored OPEC's moves in its own oil policy, said it would define its oil export platform by June 1 in the wake of the OPEC move.

Analysts stressed that pragmatism prevailed above all else in Mexico's strategy towards OPEC.

"On a day-to-day basis Mexico hasn't been a supporter of OPEC policies," said Goldstein, noting the country had produced and exported what it wanted. "Only during crises has Mexico stepped up and supported on a temporary basis cuts in production."

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Thursday, May 08, 2003 By: Patrick J. O'Donoghue

The government has launched a counter-attack on Venezuelan ranchers, agricultural producers and agribusiness leaders, accusing them of deliberately creating an artificial scarcity of products to undermine price controls and exchange rates.  The attack comes after the discovery of 100,000 kilos of chicken allegedly hoarded at the Souto Brothers industry in Bejuma (Carabobo). 

Industry Minister, Victor Alvarez says the agribusiness offensive is part of a plan to blow a hole in the government's economic policies. "There is no reason from an economical point of view that justifies outbreaks of speculation or scarcities." 

Alvarez claims that agribusiness sector is fishing for too much profit but has promised to review customer prices and alleged low profits.

However, newspaper reports indicate that people are finding it difficult to obtain maize bread powder (harina pan), white cheese, chicken and other basic products at local  markets and supermarkets. 

Federation of Chambers of Industry & Commerce (Fedecamaras) deputy president, Albis Munoz says the government wants to eliminate the private sector and its policies are distorting the market. 

Venmaiz executive president, Gisela Serrano argues that the industry has enough to cover demand till  September and blames the distortion on  scarcity. "The price of regulated maize bread powder is far too low  ... it's being produced at a loss ... industrialists are covering the surplus demand generated by the low price compared to other basic foods. 

Serrano says the product costs double in Colombia and what should go to the domestic market is being smuggled into Colombia ... "then there is the problem of getting hold of government dollars!"

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Thursday, May 08, 2003 By: Patrick J. O'Donoghue

Controversial Argentinean sociologist, Norberto Ceresole, has died in Argentina after suffering a heart attack. Born in 1943, Ceresole studied in Germany, France and Italy and has written 30 books on geo-political strategy and military sociology. His work led him to be appointed to the Soviet Union's (USSR) Science Academy at the Latin American Institute and professor at the USSR High School of War. 

In Argentina,  Ceresole joined the Montoneros' breakaway urban guerrilla group ERP, which was virtually wiped out by the military dictatorship in the 70s ... Norberto sought exile in Spain. 

Before that he acted as an adviser to Peruvian nationalist President, General Juan Velazco Alvarado towards the end of 60s and is said to have been close to President Salvador Allende in the early 70s even though his political ideology at the time would have placed him closer to the revolutionary left (MIR) . 

The sociologist met Hugo Chavez Frias in 1994 and is believed to have influenced his political thought as regarding making the army the spearhead of change in Venezuela. It is thought that the Peronist experience in Argentina forged Ceresole's now famous political triangle: warlord (caudillo), the military and the People (pueblo). 

Ceresole suggested that in Latin America and Venezuela only a military political party could overcome the fierce opposition from international and domestic reactionary forces. However, his consultancy work in Venezuela was cut short by rivalries inside Chavez Frias' Movimiento Quinta Republica (MVR) . Civilian MVR kingpins, Luis Miquilena and Jose Vicente Rangel maneuvered Ceresole out of the country. 

Ceresole became a dedicated supporter of the Palestine cause and became an avid anti-Zionist causing scandal for his position on the Holocaust. Before he died, Ceresole returned to Argentina to act as political adviser to presidential candidate, Adolfo Rodriguez Saa and to former military rebel, Lt. Colonel Aldo Rico running for the State Governorship of Buenos Aires.

Whatever can be said about Ceresole, his thinking on Latin America has a touch of originality and will not cease with his physical demise.

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Thursday, May 08, 2003 By: David Coleman

According to local media reports, the Exxon Mobil Corporation says it may go ahead with a $2 billion plastics joint venture with Venezuelan state petrochemical company, Pequiven. Exxon Mobil Venezuelan executive Mark Ward is quoted as saying that the company wants to resume talks on an agreement which has been under study for the last seven years.

"We are re-establishing contact with the new Pequiven leadership and we are waiting for Petroleos de Venezuela (PDVSA) and the Energy & Mines (MEM) Ministry to sit down and negotiate.''

The proposed plastics JV is said to be a key part of Venezuela's plans to raise petrochemical output and to reduce dependence on crude oil exports ... Pequiven and Exxon Mobil will each have a 49% stake in the project with the remaining 2% reserved for financiers.

According to an already released plan, the new plant could be located at the Jose petrochemical complex due west of Puerto La Cruz and would use natural gas from eastern oil fields as feedstock, or raw material. It would be centered around a 1 million metric tonnes a year ethylene cracker unit and would convert the resulting ethylene into 750,000 metric tonnes of polyethylenes and 420,000 metric tons of ethylene glycols.

<a href=www.vheadline.com>Venezuela's Electronic News Posted: Thursday, May 08, 2003 By: David Coleman

The Group of Friends of Venezuela created last January from Brazil, Chile, Mexico, Portugal, Spain and the United States to attempt to help the Organization of American States (OAS) arrive at a solution to Venezuela's political crisis has brokered an agreement only to end political violence and verbal insults from both sides of the political divide.

The Chavez Frias government has put OAS Secretary General Cesar Gaviria in something of an embarrassing situation by appearing to back out of an April 11 deal for a revocatory referendum on the Presidency with government negotiators saying that opposition delegates don't represent all sectors opposing Chavez and suggesting that OAS-mediated talks should more properly be replaced by democratic debate in Venezuela's own National Assembly (AN).

Legislators say parliament is better equipped for the assignment since they task since its representatives were democratically elected by the Venezuelan people, while OAS delegates are political party appointees.

Meanwhile, Interior & Justice (MIJ) Minister, General Lucas Rincon has described opposition leaders as being "brain-damaged'' since they have "excessive expectations on fighting crime."  He added that exiled CTV union leader  Carlos Ortega is "not well in the head'' while the President consistently speaks of the opposition as fascists, terrorists and coup-plotters after a 2-month labor/employer stoppage which crippled the nation's oil production and cost $6 billion. Vice President Jose Vicente Rangel has blamed the opposition saying they're "obsessed with necrophilia" latching onto violent deaths in the criminal underworld as a pretext to blame the government as "perpetrators of evil."

President Hugo Chavez Frias says that "a reckless opposition" is more interested in anti-government hatred and his unconstitutional ouster than helping any efforts to govern the country under its new-found participative democracy ... his most rabid opponents vociferously accuse him of mismanaging the economy, dividing the country along class lines and increasing authoritarianism.