www.grandforks.com Posted on Sun, Jan. 12, 2003 BY PASCAL FLETCHER Reuters

CARACAS, Venezuela - Venezuelan troops fired tear gas on Sunday to force back tens of thousands of anti-government protesters in Caracas as leftist President Hugo Chavez threatened tough measures to counter a crippling 6-week-old opposition strike.

Clouds of gas enveloped the demonstrators, who had marched toward Fuerte Tiuna military headquarters but found their path blocked by barbed wire barricades and several hundred National Guard troops and military police.

"This looks like a war zone," opposition leader Antonio Ledezma said after the protesters scattered. Several people were carried away, apparently overcome by the gas.

The clash, one of several in recent weeks, broke out on the 42nd day of a grueling opposition strike that has slashed oil output and production in the world's No. 5 petroleum exporter.

The strikers are demanding the resignation of the populist leader, who was elected in 1998, six years after he staged a botched coup bid. They want him to hold early elections.

Chavez sternly warned the opposition strikers he would not let them disrupt the nation's social and economic life by shutting down schools and banks or interfering with food supplies.

"They are attacking the country and the population ... denying them gasoline and food ... sabotaging education and health," he said during his weekly television and radio broadcast.

Chavez, who has already sacked 2,000 striking oil executives and employees, repeated threats to send troops to take over private factories and stores if anti-government businessmen withheld food supplies.

On Saturday, he warned the government would intervene in banks and schools shut by the strike.

"This was a declaration of war. Chavez is not interested in dialogue or reconciliation," glass artist Luz Marina Urrecheaga said on Sunday as she and other protesters harangued helmeted troops.

The strike has rocked Venezuela's oil-reliant economy and sent its bolivar currency tumbling. It has also jolted oil markets and the oil exporters' cartel OPEC agreed on Sunday to raise production by 1.5 million barrels per day to stave off a spike in prices threatened by the Venezuelan strike.

PROTESTERS MOCK TROOPS

The marchers had headed toward Fuerte Tiuna in a repeat of a Jan. 3 protest that left two Chavez supporters dead and dozens more injured.

A small crowd of angry Chavez supporters who turned out to confront the anti-government protesters were kept back by a separate cordon of troops.

On his weekly "Hello President" show, Chavez threatened to revoke the broadcasting licenses of private TV stations that criticize his rule.

As a result of the strike, Venezuelans have been experiencing unprecedented shortages of gasoline, cooking gas and some food items.

With many businesses closed, bank workers staged a 48-hour stoppage last week, but will reopen on Monday under restricted service hours.

Chavez, who survived a brief coup in April, says he is a champion of the poor and that wealthy and corrupt minority elites are trying to topple him.

Chavez's foes accuse him of dragging Venezuela toward Cuban-style communism. They say his support has reached an all-time low, even among the poor.

The government and opposition remain deadlocked over the timing of elections and the United States wants a negotiated settlement in talks brokered by the Organization of American States.

Opposition leaders were traveling to the United States to present their case to United Nations Secretary-General Kofi Annan and the State Department.

The opposition plans to hold a nonbinding referendum on Chavez's rule on Feb 2. Chavez says such a referendum can't be legally held until August. His term ends in early 2007.

www.voanews.com VOA News 12 Jan 2003, 15:10 UTC

Opponents of Venezuela's President Hugo Chavez are planning to march on a military complex in Caracas Sunday despite violent clashes during an earlier protest at the site.

Opposition supporters say they will march on the military base, even though a similar protest on January 3 ended in clashes with Chavez supporters that left two people dead and more than a dozen wounded.

Saturday, President Chavez again issued a stern warning to his opponents, vowing to break a six-week general strike that has crippled Venezuela's economy and its vital oil industry.

Speaking at a rally of thousands of cheering supporters at a Caracas sports arena, Mr. Chavez said his revolutionary government will not give in to opposition demands for him to resign.

Accusing strike organizers of closing many of the nation's schools, Mr. Chavez said teachers who do not show up for work will be fired.

President Chavez's opponents began the general strike December 2 to force him to resign or call early elections. He refuses to step down, saying the labor action amounts to a coup attempt.

The political crisis has paralyzed the nation's petroleum industry, which accounts for about 80 percent of Venezuela's export revenue, and has helped push up world oil prices. Before the strike began, Venezuela was the world's fifth-largest oil exporter and a key U.S. supplier.

Some information for this report provided by AP, Reuters and AFP.

www.cbc.ca 11:16 AM EST Jan 12 BRUCE STANLEY

VIENNA, Austria (AP) - OPEC needs to compensate for a shortfall in oil exports from Venezuela, but it shouldn't change its official output target of 23 million barrels a day, the group's most influential oil minister said Sunday.

An increase in the target ``would really flood the market,'' Saudi Arabian Oil Minister Ali Naimi said ahead of an emergency meeting the Organization of Petroleum Exporting Countries planned later in the day at its headquarters in Vienna.

OPEC called the meeting last week hoping to calm fears of a supply crunch caused by an ongoing strike in Venezuela. The strike, launched Dec. 2 by political opponents seeking to oust President Hugo Chavez, has slashed the country's exports by about 2 million barrels a day. Venezuela is normally OPEC's third-largest producer and a major oil supplier to the United States.

OPEC pumps about a third of the world's crude supplies, which total 79 million barrels a day.

Naimi acknowledged that the Venezuelan strike has deprived the market of crude. ``I care about what the market needs,'' he said.

But while he added that OPEC's production ceiling of 23 million barrels a day should remain unchanged, Naimi declined to say how OPEC should try to compensate for the missing Venezuelan oil.

One possible solution would be for Venezuela's OPEC partners to increase their own production to cover the shortfall until Venezuelan exports can resume.

Saudi Arabia accounts for the bulk of the group's spare production capacity and would stand to gain from any such temporary adjustment of output quotas within the overall target. Saudi Arabia's current output quota is 7.5 million barrels a day, but Naimi said his country could boost daily production to 10 million barrels within two weeks.

Still, OPEC members worry that if they do raise production, the additional barrels might hit markets just as seasonal demand starts weakening in the spring.

Neither Venezuelan Oil Minister Rafael Ramirez nor Ali Rodriguez, head of the country's state-run oil company, would say if he supported an increase in OPEC production. An unspoken concern was that any reallocation of quotas to end the shortfall might take some of the external pressure off Venezuela's opposition to end its strike.

Fears of a possible U.S.-led war against Iraq have added upward pressure to world oil prices. Iraq has the second-biggest oil reserves after Saudi Arabia, and there has been a steady buildup of U.S. troops in the Persian Gulf.

Crude prices surged in recent weeks but fell sharply in anticipation of OPEC's boosting production. On the New York Mercantile Exchange, February contracts of light, sweet crude futures fell 31 cents Friday to close at $31.68. On London's International Petroleum Exchange, February Brent crude ended at $29.67 a barrel, up 3 cents.

OPEC's price target is $22-$28 per barrel of its benchmark blend of crudes.

OPEC sources have said the Saudis were proposing to increase the group's daily output by 1.5 million barrels. Other members, including Algeria and Libya, have favored a smaller increase of 1 million barrels.

``We have to see what quantity is required,'' said Obaid bin Saif Al-Nasseri, oil minister for the United Arab Emirates, said late Saturday as he arrived at a Vienna hotel.

OPEC President Abdullah bin Hamad Al Attiyah said Venezuela's strike has caused ``a little bit of a shortage,'' but he too refused to predict how much oil OPEC might add to the market to compensate.

``I've heard a lot of scenarios, a lot of numbers, but still we haven't reached the magic number,'' he said.

Any increase would take effect Feb. 1, Al Attiyah said. That means American importers would not see any fresh crude until at least mid-March because Saudi shipments take at least 40 days to reach U.S. ports.

The suddenness of OPEC's decision to call this meeting reflects its surprise at the deterioration in market conditions. Oil ministers for four of the group's 11 members were unable attend due to prior commitments. A fifth minister, Libya's Abdulhafid Mahmoud Zlitni, was unable to arrive Sunday because a sandstorm prevented his plane from leaving the Libyan capital, Tripoli.

www.washingtonpost.com By Mark Weisbrot Sunday, January 12, 2003; Page B04

Walking around Caracas late last month during Venezuela's ongoing protests, I was surprised by what I saw. My expectations had been shaped by persistent U.S. media coverage of the nationwide strike called by the opposition, which seeks President Hugo Chavez's ouster. Yet in most of the city, where poor and working-class people live, there were few signs of the strike. Streets were crowded with holiday shoppers, metro trains and buses were running normally, and shops were open for business. Only in the eastern, wealthier neighborhoods of the capital were businesses mostly closed.

This is clearly an oil strike, not a "general strike," as it is often described. At the state-owned oil company, PDVSA, which controls the industry, management is leading the strike because it is at odds with the Chavez government. And while Venezuela depends on oil for 80 percent of its export earnings and half its national budget, the industry's workers represent a tiny fraction of the labor force. Outside the oil industry, it is hard to find workers who are actually on strike. Some have been locked out from their jobs, as business owners -- including big foreign corporations such as McDonald's and FedEx -- have closed their doors in support of the opposition.

Most Americans seem to believe that the Chavez government is a dictatorship, and one of the most repressive governments in Latin America. But these impressions are false.

Not only was Chavez democratically elected, his government is probably one of the least repressive in Latin America. This, too, is easy to see in Caracas. While army troops are deployed to protect Miraflores (the presidential compound), there is little military or police presence in most of the capital, which is particularly striking in such a tense and volatile political situation. No one seems the least bit afraid of the national government, and despite the seriousness of this latest effort to topple it, no one has been arrested for political activities.

Chavez has been reluctant to use state power to break the strike, despite the enormous damage to the economy. In the United States, a strike of this sort -- one that caused massive damage to the economy, or one where public or private workers were making political demands -- would be declared illegal. Its participants could be fired, and its leaders -- if they persisted in the strike -- imprisoned under a court injunction. In Venezuela, the issue has yet to be decided. The supreme court last month ordered PDVSA employees back to work until it rules on the strike's legality.

To anyone who has been in Venezuela lately, opposition charges that Chavez is "turning the country into a Castro-communist dictatorship" -- repeated so often that millions of Americans apparently now believe them -- are absurd on their face.

If any leaders have a penchant for dictatorship in Venezuela, it is the opposition's. On April 12 they carried out a military coup against the elected government. They installed the head of the business federation as president and dissolved the legislature and the supreme court, until mass protests and military officers reversed the coup two days later.

Military officers stand in Altamira Plaza and openly call for another coup. It is hard to think of another country where this could happen. The government's efforts to prosecute leaders of the coup were canceled when the court dismissed the charges in August. Despite the anger of his supporters, some of whom lost friends and relatives last year during the two days of the coup government, Chavez respected the decision of the court.

The opposition controls the private media, and to watch TV in Caracas is truly an Orwellian experience. The five private TV stations (there is one state-owned channel) that reach most Venezuelans play continuous anti-Chavez propaganda. But it is worse than that: They are also shamelessly dishonest. For example, on Dec. 6 an apparently deranged gunman fired on a crowd of opposition demonstrators, killing three and injuring dozens. Although there was no evidence linking the government to the crime, the television news creators -- armed with footage of bloody bodies and grieving relatives -- went to work immediately to convince the public that Chavez was responsible. Soon after the shooting, they were broadcasting grainy video clips allegedly showing the assailant attending a pro-Chavez rally.

Now consider how people in Caracas's barrios see the opposition, a view rarely heard in the United States: Led by representatives of the corrupt old order, the opposition is trying to overthrow a government that has won three elections and two referendums since 1998. Its coup failed partly because hundreds of thousands of people risked their lives by taking to the streets to defend democracy. So now it is crippling the economy with an oil strike. The upper classes are simply attempting to gain through economic sabotage what they could not and -- given the intense rivalry and hatred among opposition groups and leaders -- still cannot win at the ballot box.

From the other side of the class divide, the conflict is also seen as a struggle over who will control and benefit from the nation's oil riches. Over the last quarter-century PDVSA has swelled to a $50 billion a year enterprise, while the income of the average Venezuelan has declined and poverty has increased more than anywhere in Latin America. Billions of dollars of the oil company's revenue could instead be used to finance health care and education for millions of Venezuelans.

Now add Washington to the mix: The United States, alone in the Americas, supported the coup, and before then it increased its financial support of the opposition. Washington shares PDVSA executives' goals of increasing oil production, busting OPEC quotas and even selling off the company to private foreign investors. So it is not surprising that the whole conflict is seen in much of Latin America as just another case of Washington trying to overthrow an independent, democratically elected government.

This view from the barrios seems plausible. The polarization of Venezuelan society along class and racial lines is apparent in the demonstrations themselves. The pro-government marches are filled with poor and working-class people who are noticeably darker -- descendants of the country's indigenous people and African slaves -- than the more expensively dressed upper classes of the opposition. Supporters of the opposition that I spoke with dismissed these differences, insisting that Chavez's followers were simply "ignorant," and were being manipulated by a "demagogue."

But for many, Chavez is the best, and possibly last, hope not only for social and economic betterment, but for democracy itself. At the pro-government demonstrations, people carry pocket-size copies of the country's 1999 constitution, and vendors hawk them to the crowds. Leaders of the various non-governmental organizations that I met with, who helped draft the constitution, have different reasons for revering it: women's groups, for example, because of its anti-discrimination articles; and indigenous leaders because it is the first to recognize their people's rights. But all see themselves as defending constitutional democracy and civil liberties against what they describe as "the threat of fascism" from the opposition.

This threat is very real. Opposition leaders have made no apologies for the April coup, nor for the arrest and killing of scores of civilians during the two days of illegal government. They continue to stand up on television and appeal for another coup -- which, given the depth of Chavez's support, would have to be bloody in order to hold power.

Where does the U.S. government now stand on the question of democracy in Venezuela? The Bush administration joined the opposition in taking advantage of the Dec. 6 shootings to call for early elections, which would violate the Venezuelan constitution. The administration reversed itself the next week, but despite paying lip service to the negotiations mediated by the OAS, it has done nothing to encourage its allies in the opposition to seek a constitutional or even a peaceful solution.

Sixteen members of Congress sent a letter to Bush last month, asking him to state clearly that the United States would not have normal diplomatic relations with a coup-installed government in Venezuela. But despite its apprehension about disruption of Venezuelan oil supplies on the eve of a probable war against Iraq, the Bush administration is not yet ready to give up any of its options for "regime change" in Caracas. And -- not surprisingly -- neither is the Venezuelan opposition.

Mark Weisbrot is co-director of the Center for Economic and Policy Research, an independent nonpartisan think tank in Washington.

santafenewmexican.com Associated Press 01/12/2003

VIENNA, Austria—OPEC representatives arriving for an emergency meeting on oil production sought to reassure markets Saturday that the producers' cartel would supply enough crude to offset a shortfall in exports from Venezuela.

Delegates of the Organization of Petroleum Exporting Countries will consider increasing their official output of 23 million barrels a day by up to 6.5 percent when they meet today at group headquarters here.

OPEC called the meeting last week hoping to calm fears of a supply crunch caused by the ongoing strike in Venezuela. The strike, launched Dec. 2 by political opponents seeking to oust President Hugo Chávez, has slashed the country's exports by about 2 million barrels a day. Venezuela is the world's fifth-largest exporter and a major oil supplier to the United States.

Concerns about a possible U.S.-led war against Iraq have added pressure to world oil prices. Iraq has the second-biggest oil reserves after Saudi Arabia and there has been a steady buildup of American troops in the Persian Gulf.

Crude prices surged in recent weeks but fell sharply in anticipation of OPEC boosting production by up to 1.5 million barrels a day. OPEC pumps about a third of the world's crude supplies, which total about 79 million barrels a day.

"There will be no shortage of oil in the market. There will be no missing barrels," Saudi Arabian Oil Minister Ali Naimi said while arriving at his Vienna hotel.

Saudi Arabia is OPEC's most influential member and accounts for the bulk of the group's spare-production capacity.

An OPEC source said recently the Saudis were proposing to increase the group's daily output by 1.5 million barrels. Other members, including Algeria and Libya, favor a smaller increase of 1 million barrels.

"We have to see what quantity is required," said Obaid bin Saif Al-Nasseri, oil minister for the United Arab Emirates, speaking to reporters.

OPEC President Abdullah bin Hamad Al Attiyah acknowledged that the six-week strike that has crippled Venezuela's state-run oil monopoly has caused "a little bit of a shortage," but he refused to predict how much oil OPEC might add to the market to compensate.

"I've heard a lot of scenarios, a lot of numbers, but still we haven't reached the magic number," he said.

Naimi said he wanted to see the price of crude "less than what it is today."

Any increase would take effect Feb. 1, Al Attiyah said. That means American importers would not see any fresh crude until at least mid-March since Saudi shipments take at least 40 days to reach U.S. ports.

Some analysts argue that OPEC already is overshooting its new output target, set in December, and that any official increase would simply legitimize this overproduction.

A decision to increase output would mark an abrupt reversal of OPEC policy. The cartel's members decided just a month ago in Vienna to trim output by as much as 1.7 million barrels a day. The suddenness of OPEC's decision to call this meeting reflects its surprise at the deterioration in market conditions.

Saudi Arabia stands to gain the most from any production increase. Some OPEC members, including Indonesia, already are producing at or near capacity.

"This is an opportunity for Saudi (Arabia) to show that it is still a very valuable friend of the (United States)," said Raad Alkadiri, an analyst with The Petroleum Finance Co. in Washington.