www.timesdaily.com By CHRISTOPHER TOOTHAKER Associated Press Writer February 18. 2003 4:57AM

Oil output could reach 2.8 million barrels day within a month, when restrictions on sending tankers to Venezuelan ports are lifted, the head of Venezuela's state-run oil company said Monday. Foreign shippers were warned against loading in Venezuelan ports during a two-month strike against President Hugo Chavez. The work stoppage ended on Feb. 3 in all sectors except the all-important oil industry. Ali Rodriguez, president of Petroleos de Venezuela S.A., or PDVSA, accused striking employees of scaring off shippers by telling them new, inexperienced workers at docks and loading terminals presented a risk. "Due to a publicity campaign some companies fear sending their tankers," Rodriguez told a press conference. Some major companies in the shipping and oil industry, however, have decided to return to Venezuela. Exxon Mobil Corp. plans to resume loading this week while refiner Valero Energy Corp. has chartered a tanker to load 2 million barrels of crude. In order to boost production as planned, stockpiled oil filling storage tanks, a bottleneck which leaves no space for freshly produced crude, must be exported. Once exports pick up, oil output could jump to 2.8 million barrels per day - Venezuela's quota as set by the Organization of Petroleum Exporting Countries - by mid-March, said Rodriguez. Speaking during his Sunday radio program "Hello President," Chavez said oil production has already reached 2.1 million barrels per day. However, ex-PDVSA staff claim total output stands at roughly 1.4 million barrels per day. Venezuela, the world's fifth largest oil exporter and a major supplier to the United States, was producing 3.2 million barrels per day before the strike. Output fell as low as 200,000 barrels per day in December. Chavez, a former paratrooper who was elected in 1998 and re-elected in 2000 to a six-year term, is continuing efforts to regain control of PDVSA. To squeeze out dissent, Chavez has fired one-third of the company's 37,942-strong work force. He claims most of PDVSA's employees have returned to work. Strike leaders deny the claim, saying thousands refuse to return until Chavez rescinds the firings and agrees to early elections. At negotiations mediated by the Organization of American States, government representatives have rejected opposition demands that dissident PDVSA workers be allowed to return to their jobs. Using tear gas and rubber bullets, National Guardsmen dispersed dozens of protesting oil workers in western Zulia state on Monday. One protester suffered injuries when shot with rubber bullets. Dissident employees also staged an anti-Chavez street march in the capital. Chavez has balked at a proposal to hold early elections as a means of ending the nation's political stalemate. The opposition must wait for a binding recall referendum halfway through his term, or August 19, Chavez says. Meanwhile, Venezuelans continue waiting in mile-long lines outside service stations due to gasoline shortages and reduced refining capacity caused by the strike. Venezuela imported 11 million barrels of gasoline between December and January for the domestic market to deal with shortages. Another 12 million barrels of gasoline will be imported this month. Normally, Venezuela refines about 250,000 barrels of gasoline per day for domestic use. Approximately 150,000 barrels are currently being refined.

news.bbc.co.uk

Tuesday, 18 February, 2003, 02:55 GMT

The opposition is calling on Chavez to stand down

Venezuela's government and opposition have agreed to condemn violence and defuse tensions between them, the Organisation of American States (OAS) says.

OAS Secretary General Cesar Gaviria said the two sides would sign a common statement in favour of peace and democracy on Tuesday.

Chavez describes his opponents as 'terrorists'

It is the first firm development in three months of talks mediated by Mr Gaviria, and backed more by a six-nation group led by the United States.

But a source close to the talks said the document carried no sanctions, and the two sides were no closer to a deal ending their conflict.

The opposition wants Mr Chavez to stand down and call a fresh referendum immediately.

The president, who was re-elected in 2000, has refused to consider a vote on his rule before August.

Paralysis

"We have finished the round of negotiation and dialogue to complete a declaration against violence," Mr Gaviria said on Monday.

Opposition marches are a regular feature in Caracas

The document is also believed to include references to freedom of expression, the media's role in promoting peace, and calls to tone down aggressive language.

Opposition leader Timoteo Zambrana told the BBC he hoped the statement would help reduce tensions in Venezuela.

An ongoing national strike and a wave of demonstrations by both government and opposition supporters have paralysed much of the country and led to the deaths of at least six people this year.

Mr Chavez has used troops and replacement crews to restart the vital oil sector - although many sacked oil workers have vowed to keep their protest.

The opposition accuses the president of being too authoritarian and blames him for the country's economic woes.

www.nytimes.com By JUAN FORERO

BOGOTÁ, Colombia, Feb. 17 — The state-owned oil company in Venezuela, though hobbled by a faltering 78-day strike by oil workers, could be producing 2.8 million barrels per day within a month, Venezuela's quota as set by the Organization of the Petroleum Exporting Countries, the president of the company said today. Advertisement

Reaching 2.8 million barrels per day would be a milestone for the state-owned company, Petróleos de Venezuela, once the world's second-largest oil company and a major supplier of petroleum to the United States. The company used to produce 3.1 million barrels a day until an antigovernment strike paralyzed production, devastating Venezuela's economy and severely testing the leftist government of President Hugo Chávez.

The announcement by Alí Rodríguez, president of the company, was quickly challenged by dissident oil executives who on Dec. 2 led a walkout of thousands of workers that continues to this day. The walkout was part of a nationwide general action, but the strike in the other sectors fizzled out earlier this month.

The government and the opposition agreed today to an eight-point resolution to reduce tensions, the first development in three months of talks guided by the Organization of American States, Reuters reported, quoting a source close to the talks as saying, however, that a deal to end the conflict seemed no closer.

The striking oil executives say that production stands at 1.4 million barrels per day, and that reaching 2.8 million per day will take many more months because Petróleos de Venezuela lacks the managers and technicians to reactivate the industry quickly and properly. Mr. Chávez has fired nearly 13,000 striking workers, many of them senior executives and highly trained engineers.

"Without these people what will Pdvsa do?" José Toro Hardy, an oil analyst and former company board member, said in a recent interview, using the name by which the company is widely known. "Instead of producing 3.1 million, it could produce 1.5 to 1.8 million."

Indeed, oil analysts outside Venezuela say Petróleos de Venezuela would probably never again be the same giant it once was because it has been so hobbled by the loss of qualified workers, the damage to its reputation caused by the strike and financial losses estimated at $3 billion.

But Mr. Chávez's government has touted its efforts to restart the oil industry, saying the company is now producing more than two million barrels each day as blue collar workers returned to their jobs. Today, Mr. Rodríguez also announced that the company would soon be meeting domestic demand for gasoline.

Mr. Rodríguez, and other managers at Petróleos de Venezuela, are going through with a restructuring of the company that they say will see it split in two. The plan is to cut jobs and streamline operations, which has prompted speculation that the company's refineries in the United States could be sold.

Today, Mr. Rodríguez denied that the government was considering selling those refineries, operated by Citgo, but he did say that Petróleos de Venezuela was reviewing all of its worldwide assets to determine if any should be sold. "At the moment, we are in the process of a review of all of Pdvsa's businesses, domestic and international," he said. "Once that review has been completed, once we have a new business plan set out, which is being drawn up, then we will make the decisions about businesses at home and abroad."

How Venezuelan Outlasted His Foes  (February 7, 2003)  $ World Briefing | Americas: Venezuela: Chávez Rejects Early Election

www.forbes.com Reuters, 02.17.03, 8:06 PM ET

CARACAS, Venezuela (Reuters) - Venezuela's government and opposition agreed Monday to an anti-violence pact to lower tensions and curb harsh rhetoric that often inflames their feud over the rule of President Hugo Chavez. The eight-point resolution was the first firm development from three months of frustrating talks guided by the Organization of American States and backed more recently by a six-nation group led by the U.S. But a source close to the negotiations said the document carried no sanctions and the feuding sides appeared no closer to a deal on elections to end their political conflict in the world's No. 5 oil exporter. The agreement includes references to freedom of expression, the media's role in promoting peace, condemns violence and also urges a toning down of aggressive language, the source said. OAS Secretary General Cesar Gaviria, who has guided the talks, said the government and opposition would sign the resolution Tuesday. "We have finished the round of negotiation and dialogue to complete a declaration against violence," Gaviria said. At least seven people have died in clashes or violence during rallies and marches since December when the opposition started a two-month strike that failed to oust a president who they accuse of ruling Venezuela like a dictator. Chavez, a retired paratrooper whose populist speeches are often laced with aggressive class warfare references, accuses his enemies and private media stations of being "terrorists" conspiring to topple him. But his opponents say the president has inspired his mostly poor followers to acts of violence with his tirades against the "rich elites" he says have long robbed the nation of its huge oil wealth. Chavez has recently stepped up his aggressive tone and toughened his stance since opposition leaders called off their strike that tried to push him from office by starving the state of its vital oil revenues. After introducing harsh currency controls to offset the economic impact of the shutdown, Chavez has threatened to close off access to dollars to opposition businesses. He warned on Sunday he would send troops to take over food plants that fail to comply with new price curbs on basic goods and services. He has also threatened to take off the air private TV and radio stations highly critical of his government. Opposition leaders fear a recently proposed law on social responsibility will be used to muzzle his foes. The combative Venezuelan leader, who led a bloody, botched coup bid six years before turning to the ballot box, has used troops and replacement crews to restart the oil sector. Rebel workers at the state oil firm PDVSA, more than 12,000 of whom have been fired for going on strike, have vowed to keep up a protest until Chavez leaves. The fate of the oil workers will prove a further sticking point during peace negotiations.

www.newsmax.com Tiana Perez Tuesday, Feb. 18, 2003

Venezuelan President Hugo Chavez announced during his weekly TV program “Aló Presidente” that the military forces would take over factories that do not follow price controls set on about 200 products by the government two weeks ago.

The President stated, “I order the Minister of Defense and his commanders and military headquarters to invade corn flour (basic product in the Venezuelan diet) processing plants if anyone thinks about closing these.”

The bundled price and exchange control measures threaten to force many companies out of business, as margins could become negative amidst the rise in production costs.

Samuel Ruh, the Minister of Consumer Defense and User Education, announced, “The businesses that incurred crimes of price speculation and withholding of merchandise would be fined a maximum penalty of 18 million bolivares,” an equivalent of US $11,200. Additional penalties include 1 to 3 year incarceration for those companies that will not be able to operate within the price control scheme set by the government.

In a move to eliminate all opposition factions, part of which belong to the business sector, Chavez said “not a dollar for the coup-plotters” during a speech held two weeks ago.

Discriminating Against the Opposition

Businesses who are openly opposing Chavez’s presidential term expect to be discriminated against in the sale of preferential dollars. Calculated demand for dollars, estimated at 90 million dollars per trimester, was cut short by the budget for Candivi, the newly formed agency in charge of controlling the sale of dollars, to 40 million dollars.

The Central Bank of Venezuela has announced the exchange control system will remain in place for at least six more months. However the agency’s President believes the control will last until December 2003.

Meanwhile, Venezuelans’ main worry stems from the lack of available products on shelf and not so much from pricing. The absence of mayonnaise, tomato sauce, butter, corn flour, wheat flour, and lentils, among many other products is affecting the middle-classes’ food supplies.

As a response to Chavez’ measures, the opposition is set to file a complaint at the Supreme Courts of Justice aimed at annulling the exchange controls alleging that these were approved unconstitutionally. Decrees, such as this one, need to be approved by a two-thirds majority of Congress unless an economic emergency situation is declared. At the moment, Venezuela still enjoys the benefits of the rule of law.

It is possible that the opposition’s complaint will be considered now that the judges at the Supreme Courts of Justice no longer cater to presidential demands.

Chavez voiced his dissatisfaction with the current judges at the Supreme Courts of Justice. He complained about the judges not having the necessary valor to adopt the necessary measures. He added, “the set of judges need to be replaced by others who would support the project that I conduct,” the so-called Bolivarian Revolution.