Venezuela Oil Sales Up, Crimped by Strike

— By Matthew Robinson

CARACAS, Venezuela (Reuters) - Oil shipments by the world's No. 5 crude exporter rose in the past week but were held to less than 20 percent of November levels by a four-week strike led by foes of Venezuelan President Hugo Chavez.

Government efforts to break the strike helped boost oil exports to about 520,000 barrels per day (bpd) in the week ending Dec. 29, according to data from state oil firm Petroleos de Venezuela (PDVSA) and independent shippers.

In the previous week, the government dispatched 260,000 bpd of crude, including one cargo destined for a domestic port. Venezuela exported about 2.7 million bpd of crude and products in November.

Half of the crude sold in the past seven days, about 260,000 bpd, went to the United States, which imported 1.4 million bpd from Venezuela in October.

But Venezuelan oil exports for December have averaged just 230,000 bpd, helping push U.S. oil futures to a two-year high of $32.76 a barrel in the past week.

Striking PDVSA workers have said the government's ability to maintain even limited oil sales will be severely hindered once domestic storage tanks are drained, as production has fallen to levels that will not support exports.

"Production is 200,000 bpd," opposition PDVSA executive Horacio Medina said in a television interview on Sunday. The OPEC member nation had produced 3.1 million bpd in November.

Many executives and managers from PDVSA, as well as field and refinery workers, tanker captains, pilots and dock crews have joined the stoppage aimed at removing Chavez from office.

BATTLE FOR OIL

But Chavez has refused to resign or call early elections and maintains that he is winning the battle for the oil industry, which provides about half of government revenues. Dissident PDVSA employees have said that the government will not be able to bring operations back to normal levels using replacement workers.

"In the last four days, we have moved seven and a half million barrels of oil and within one week we will be producing more than a million barrels (per day) of petroleum," Chavez said on Sunday during his weekly television and radio show, "Hello, President."

According to data supplied by PDVSA President Ali Rodriguez and confirmed by independent shipping reports, Venezuela has exported about 2 million barrels of crude in the past four days.

Rodriguez told reporters at a late Saturday press conference that the government had managed to increase oil production to between 600,000 bpd to 700,000 bpd, adding that oil output figures he quoted to reporters on Saturday, indicating production was 1.5 million bpd, were incorrect.

The PDVSA chief said oil production would hit 2 million bpd by the end of January, and that the 130,000 bpd El Palito refinery would restart operations this week.

Rodriguez said late Saturday that production from four foreign-backed extra heavy oil projects shutdown by the strike would also be returned in the next week. The four projects, which partner oil majors such as ExxonMobil <XOM.N> and ChevronTexaco <CVX.N> with PDVSA, produced over 400,000 bpd of extra heavy oil last month.

But his statements were disputed by foreign oil officials.

"I don't think so. There are two many things that need to take place," said an official with one of the projects who asked not to be identified. "Who is going to work the plants? Who is going to bring ships in?"

Foreign oil companies have not been loading cargoes because vessels attended by uncertified crews would face insurance risks. Only ships chartered by PDVSA and U.S. refining affiliate Citgo have sailed.

Chavez said on Sunday that he had fired 90 PDVSA executives and managers taking part in the stoppage and that others were under investigation.

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