Chavez Says Venezuela Gaining Control of Oil Assets

Monday, December 30, 2002 00:21 AM ET     CARACAS, Venezuela -- A 29-day conflict between striking employees of the state oil company and President Hugo Chavez's government has turned into a war of attrition, Monday's Wall Street Journal reported.

In a media blitz over the weekend, the government claimed it was winning the war against the strikers. But dissident employees at Petroleos de Venezuela SA, or PdVSA, accuse Mr. Chavez and his ministers of pursuing a "big lie" propaganda strategy.

The world's fifth-largest oil exporter has been forced to import gasoline to keep a limited number of cars and trucks on the road. A tanker ship arrived Saturday from Brazil with 22 million gallons of gasoline; another is en route from Trinidad carrying 16.8 million gallons.

The battle for PdVSA already has cost the government at least $1.5 billion and threatens to dry up the 50% of state revenues that come from international oil sales. Moreover, buying gasoline on the spot market at around $60 a barrel and selling it on the domestic market at a subsidized $11 barrel is an expensive contingency, said PdVSA President Ali Rodriguez. Nevertheless, he said, "We'll buy from foreign sources whenever we need to. It's a precaution."

Wall Street Journal Staff Reporter Marc Lifsher contributed to this report.