newsobserver.com Tuesday, January 21, 2003 6:48PM EST By JOSEPH B. FRAZIER, ASSOCIATED PRESS WRITER

CARACAS, Venezuela (AP) - Fearing dangers to their employees from Venezuela's political violence, many multinational companies are sending workers home or suspending operations, or both.

Microsoft Corp. on Monday closed two Venezuela offices, saying it could not guarantee employees' safety. The company has about 85 employees in Caracas and six in the western city of Maracaibo. Since Venezuela's opposition called a strike Dec. 2 aimed at ousting President Hugo Chavez, oil companies such as ConocoPhillips and France's TotalFinaElf have withdrawn nonessential expatriate staff. Some fast food franchises such as McDonald's, Burger King, Wendy's and Subway have closed.

The total number of companies and workers isn't known, but departures accelerated after the U.S. Embassy and other missions issued strong safety warnings in December.

The U.S. Embassy sent off its own nonessential staff and closed its commercial attache's office.

Dozens of Venezuelans have been killed in political violence since an April coup briefly toppled Chavez. Six have been killed since the strike began.

None of the companies has announced it is withdrawing for good. Venezuela is the world's fifth-largest exporter of crude, and it has accumulated $20 billion in investment in its natural gas, oil and oil-related services sector alone in the past 10 years.

"I think (oil companies) are assessing the situation and trying to stay as invisible as possible," said Larry Goldstein, president of the New York-based Petroleum Research Foundation. "Politically they don't want to be seen as choosing sides right now. Some have substantial investments they have to protect."

Many local workers are striking and others can't get to work because of gasoline shortages. Political protests occur daily and often end in violence. Financial transactions can be hard to complete since Venezuelan banks are operating only three hours a day.

Ricardo Tinoco, a spokesman for Ford Motor Co. in Venezuela, said operations have been suspended since early December.

He said all employees were told to come back next week. "But in light of the current situation, the lack of fuel and the fact that many of our suppliers are on strike, we don't see how we'll be able to start operations next week as planned," he said.

Ford has a large assembly plant in Valencia, 70 miles west of Caracas.

Venezuela's military raided a Coca-Cola affiliate bottler and another bottler belonging to Venezuela's largest food and drinks producer, Empresas Polar, on Friday. Both companies denied hoarding goods.

The Venezuelan American Chamber of Commerce condemned the raids as "a grave rupture of the state of law." It warned more than 1,000 affiliates that the army could commit more abuses and urged them to report alleged violations.

www.iht.com The Associated Press The Associated Press Wednesday, January 22, 2003 Aim is to end strike and call early election   CARACAS Former President Jimmy Carter said Tuesday he drafted two proposals to lead Venezuela toward elections and end a 51-day strike intended to force President Hugo Chavez from office.

Carter made his proposals after attending negotiations between the government and opposition and meeting separately with Chavez and strike leaders. His Atlanta-based Carter Center, the Organization of American States and the United Nations are sponsoring the talks.

One proposal would amend Venezuela's constitution to allow for early general elections and to cut terms in office, Carter said. The amendment would have to be approved by Congress and voters. Venezuela's opposition would call off the strike and, in return, the government - which has a majority in Congress - would agree to move quickly to adopt the amendment and organize early elections, Carter said.

Carter's second proposal calls for both sides to wait for a recall referendum on Chavez's rule, which the constitution says can happen halfway into the president's six-year term. In Chavez's case, that is August.

Carter, a Nobel Peace Prize winner, said before leaving Venezuela that the government and opposition would receive his proposals later Tuesday.

"We've been pleased with the reception we've had from both the government and the opposition," Carter said. "My opinion is that both sides want to end an impasse that is destroying the economy."

Business leaders, labor unions and opposition parties launched the strike Dec. 2 to demand that Chavez resign or call early elections.

Chavez said Tuesday he told Carter he would abide by any constitutional changes.

The strike has crippled Venezuela's oil industry, which was the world's fifth-largest exporter and a major supplier to the United States.

The strike has slashed production by more than two-thirds and caused domestic shortages of gasoline, food and drinking water. It has cost Venezuela $4 billion, according to the government, and contributed to the plummeting of the bolivar currency.

The Organization of Petroleum Exporting Countries said it will be difficult to make up for shortages of Venezuelan oil in the United States because many U.S. refineries are geared to process heavier Venezuelan crude.

After an early surge Tuesday, European Brent crude fell to $30 a barrel after Venezuelan tanker pilots announced they would resume work - which could convince foreign tanker companies to dock at Venezuelan ports. Foreign companies refused to do so during the strike for security and insurance reasons.

At least six people have died in political violence since the strike began, including a man killed Monday in clashes between Chavez supporters and opposition marchers. The violence in Charallave, 32 kilometers (20 miles) south of Caracas, also injured dozens.

Six countries - Brazil, Chile, Mexico, Portugal, Spain and the United States - have begun an initiative called "Friends of Venezuela" to help end the crisis. Diplomats from the six nations will meet at OAS headquarters in Washington on Friday.

www.billingsgazette.com Associated Press

CARACAS, Venezuela (AP) - Petroleum prices rose Tuesday as a strike that has disabled the world's fifth-largest oil exporter entered its 51st day and international mediators struggled to resolve the stoppage aimed at forcing President Hugo Chavez from office.

European Brent crude soared to new two-year highs at more than $31 a barrel because of the Venezuelan crisis, possible war in Iraq and cold weather in the United States.

The Organization of Petroleum Exporting Countries, meanwhile, said it will be difficult to make up for shortages of Venezuelan oil in the United States because many U.S. refineries are geared to process heavier Venezuelan crude.

The strike has slashed Venezuela's oil production by more than two-thirds and caused domestic shortages of gasoline, food and drinking water. It has cost Venezuela $4 billion, according to the government, and contributed to the plummeting of the bolivar currency.

Former President Jimmy Carter was in Caracas trying to help resolve the situation. He was meeting with Chavez at the presidential palace early Tuesday.

Carter, who won the Nobel Peace Prize in October, attended negotiations between the government and opposition Monday and met separately with the president, strike leaders and Organization of American States secretary general Cesar Gaviria.

Carter's Atlanta-based Carter Center, the OAS and the United Nations are sponsoring the talks.

Business leaders, labor unions and opposition parties launched the strike Dec. 2 to demand that Chavez resign or call early elections.

Chavez threatened Sunday to walk out of talks, accusing the opposition of trying to topple him even as they negotiated. Strike leader Carlos Ortega said Chavez would never accept a vote on his rule.

Ortega, president of the 1 million member Confederation of Venezuelan Workers, said Gaviria and Carter should "convince themselves once and for all that we are dealing with a regime that is not democratic, and that as long as Chavez stays in power there is no possibility of holding elections."

One man was killed and 27 were injured Monday when gunfire erupted as Chavez supporters confronted opposition marchers in Charallave, a town about 20 miles south of Caracas. At least six people have died in political violence since the strike began.

Six countries - Brazil, Chile, Mexico, Portugal, Spain and the United States - have begun an initiative called "Friends of Venezuela" to help end the crisis. Diplomats from the six nations will meet at OAS headquarters in Washington on Friday.

The National Elections Council, accepting an opposition petition, agreed to organize a Feb. 2 nonbinding referendum asking citizens whether Chavez should step down.

Chavez says the vote would be unconstitutional and his supporters have challenged it in the Supreme Court. But the president has welcomed a possible binding referendum halfway through his six-year-term, or August, as allowed by the constitution.

The 48-year-old Chavez was elected in 1998 and re-elected in 2000 on promises to redistribute the country's vast oil wealth among the poor majority.

His opponents accusing him of steering the economy into recession with leftist policies and running roughshod over democratic institutions.

www.forbes.com Reuters, 01.21.03, 10:23 AM ET

CARACAS, Venezuela, Jan 21 (Reuters) - Car sales in strike-hit Venezuela fell 40.7 percent to 128,623 units in 2002 compared with a year earlier, the Venezuelan Automobile Chamber (CAVENEZ) said on Tuesday.

Nationwide car sales in December, when foes of leftist President Hugo Chavez began a strike to force him to resign, plummeted 91.7 percent to 1,627 units compared with a year earlier when 19,602 units were sold, the chamber reported.

Venezuela has been struggling with a deepening recession and growing political tensions since a brief coup against Chavez last April. The chamber had earlier forecast sales would fall about 35 percent for the year due to the South American nation's sharp economic downturn.

The companies affiliated with CAVENEZ are DaimlerChrysler AG's

(nyse: DCX - news - people)<DCXGn.DE> DaimlerChrysler de Venezuela, Fiat SpA's

<FIA.MI> Fiat Automoviles, Fiat affiliate IVECO Venezuela, Ford Motor Co. (nyse: DCX - news - people), General Motors Corp.'s (nyse: DCX - news - people) General Motors de Venezuela, AB Volvo <VOLVb.ST> affiliate Mack de Venezuela, Mitsubishi Motors Corp.'s <7211.T> MMC Automotriz and Toyota Motor Corp.'s <7203.T> Toyota de Venezuela.

The figures represent the total vehicle sales in Venezuela, and also include car models made by non-members of CAVENEZ, such as Mazda Motor Corp. <7261.T> and Volkswagen AG <VOWG.DE>.

cbs.marketwatch.com By Myra P. Saefong, CBS.MarketWatch.com Last Update: 4:03 PM ET Jan. 21, 2003

NEW YORK (CBS.MW) -- Efforts to end Venezuela's eight-week strike failed to put a damper on crude futures Tuesday, with concerns over tighter global supplies in the event of a U.S. war on Iraq taking prices for an expiring crude contract past $35 a barrel.

The price of a barrel of crude for February delivery traded as high as $35.20 a barrel on the New York Mercantile Exchange -- the highest futures level seen since November of 2000 when prices touched $35.84. The contract closed at $34.61, up 70 cents.

Action in March crude was relatively muted in comparison. The contract, which became the lead-month contract as of Tuesday's close, rose by 23 cents to $33.19 a barrel. It traded between $32.10 and $34 a barrel.

Also on Nymex, gold futures closed above $357, taking cues from the U.S. stock market, dollar and developments overseas. See Metals Stocks.

"The focus of the markets is firmly on Iraq," said BridgetonGlobal.com head analyst Jeff Mokychic.

If the market were to receive confirmation to an end of the Venezuela strike, March crude oil would still likely remain supported above $30 per barrel, he said.

Infinity Brokerage Services' head financial analyst John Person noted that it'll take Venezuela at least three weeks to get back to normal production levels if the workers are fully motivated and eager to work.

If workers aren't motivated, however, "it could take as much as two months to see a complete recovery in the pre-strike output levels," he said.

Oil prices could retest the $29 a barrel in a "short period of time" if supplies and shipments are replenished by a quick resolution by the end of this week, he said. But that's as long as a war doesn't break out in Iraq by that time, he added.

For now, supplies remain tight. Updates on U.S. supplies from the American Petroleum Institute and Energy Department won't be released until Thursday morning, a day late due to Monday's Martin Luther King, Jr. holiday. IFR Pegasus expects the data to reveal a 1 million- to 3 million-barrel decline in crude inventories as the week ended Jan. 17.

Efforts on the rise

Michael Fitzpatrick, an analyst at Fimat USA pointed out several diplomatic initiatives Tuesday concerning Venezuela, including ones by the Organization of American States and negotiations mediated by former U.S. President Jimmy Carter.

Additionally, oil tanker workers are reportedly considering an offer from the government aimed at their ending the strike, which began Dec. 2.

In recent days, the level of violence in strife-torn Venezuela has increased.

One man was killed and 27 people were injured Monday when supporters of Venezuelan president Hugo Chavez confronted opposition marchers in a town about 20 miles south of Caracas. At least six have died in political violence since the strike began, with the opposition pressing for Chavez to resign or hold new elections for the presidency.

The Chavez government claims that daily oil output is at around 1 million barrels, but strikers counter that it's at half that amount. Venezuela produced around 3 million barrels per day before the strike began.

Over in the Middle East, Taha Yassin Ramadan, an Iraqi vice president, said Tuesday that Iraq will expand its cooperation with U.N. weapons inspectors under a new agreement worked out in two days of talks but added he's convinced the U.S. military will eventually stage an attack.

Petroleum-product prices continued lower despite the bounce in crude. February unleaded gasoline fell by 1.01 cents to 90.1 cents a gallon. February heating oil closed at 89.47 cents a gallon, down 0.39 cent.

Also on Nymex, February natural gas shed 10.3 cents to close at $5.433 per million British thermal units, but Fimat's Fitzpatrick said prices are likely to move higher amid forecasts for "extremely cold" temperatures this week and expectations of a large decline in last week's U.S. supplies.

Meanwhile, disappointing quarterly results weighed on most oil-service stocks. The Oil Service Index ($OSX: news, chart, profile) traded down 2.6 percent.

The Reuters/CRB Index, a broad-based measure of the commodity futures market, closed at 242.1, up 0.1 percent. Myra P. Saefong is a reporter for CBS.MarketWatch.com in San Francisco.