www.ktul.com Saturday February 08, 2003 6:53pm More Information

Chavez Backers Attack City Hall Caracus (AP) - Tens of thousands of Venezuelans marched Saturday in support of 9,000 oil workers fired for leading a two-month strike against President Hugo Chavez that battered the economy of this oil-dependent nation. Chavez opponents gathered outside four Caracas office buildings of the state oil monopoly, Petroleos de Venezuela S.A., or PDVSA, waving national flags and chanting anti-government slogans. "Chavez, thief! PDVSA is not yours, it's everyone's," the crowd chanted. Venezuela's opposition - business groups, labor unions and leftist and conservative politicians - this week ended a two-month general strike in all areas but the crucial oil industry. The strike began Dec. 2 and sought Chavez's resignation or early elections. The government claims most of PDVSA's 40,000 employees have returned to work. Strike leaders deny this, saying thousands refuse to return to their posts until Chavez rehires the fired workers and agrees to an early vote on his rule. The government gradually is recovering Venezuela's oil industry, which was the world's fifth-largest exporter and a major U.S. supplier before the strike, when production was 3 million barrels a day. Production during the strike fell to a low of 200,000 barrels. The government says production now is at 1.9 million barrels, while dissident executives put the figure at 1.3 million. But two of the country's three major refineries remain largely idle and gasoline is scarce nationwide. Motorists wait in mile-long lines outside the few service stations with supplies. The strike has cost Venezuela at least $4 billion, the government estimates. The government has spent more than $500 million on gasoline and diesel imports since the strike began. Lines dwindled earlier this week with an influx of imports. "Venezuelans are fed up," storeowner Carlos Herrera, 43, said at Saturday's march. "While Chavez fires brave workers, the people are still suffering from gasoline shortages because he has hired a bunch of incapable mercenaries. Their only merit is being partisan to his revolution." Chavez has taken advantage of the strike to restructure PDVSA drastically. He has split the oil behemoth into two units, one for eastern Venezuela and one for western Venezuela, to reduce bureaucracy in Caracas, where dissent ran high. Striking workers say the restructuring will weaken the company and scale back fiscal contribution in an industry that provides 70 percent of export earnings. Marchers planned to deliver a letter of support for the oil workers to representatives of the Organization of American States, which is overseeing peace talks between the government and opposition. They said the letter was signed by more than 2 million Venezuelans. OAS Secretary General Cesar Gaviria is supported in his mediation efforts by a six-nation panel called the "Group of Friends." On Friday, Chavez warned the United States, Brazil, Chile, Mexico, Spain and Portugal to recognize the "legitimate, democratic government" of Venezuela. He urged the international community not to be fooled by "lies" spread by the opposition-dominated media, whom he labeled "coup-plotters and fascists." Opposition negotiators are demanding a constitution amendment that would shorten Chavez's six-year term and pave the way for general elections this year.

February 9, 2003 www.nytimes.com By JUAN FORERO

CARACAS, Venezuela, Feb. 8 — He wears pastel-colored suits and wire-rimmed glasses. His thinning hair is neatly combed. Restrained and a little stiff, he speaks in the dry tones and jargon-filled language of a technocrat on such obscure topics as 1958 American oil regulations or 1930's energy policies in Venezuela.

In short, he looks and sounds every bit the oil executive he is — the president of one of the largest, most complicated and, these days, most embattled companies in the world, Petróleos de Venezuela.

But make no mistake, Alí Rodríguez still sees himself as a revolutionary. His boss, after all, is President Hugo Chávez, whose sharp tongue and efforts to remake Venezuelan society have left the country deeply divided and on the edge of economic collapse.

Though his résumé makes no mention of it, Mr. Rodríguez has leftist, some would say radical, credentials. For 20 years, he was a clandestine agitator and a fighter in a Cuban-inspired rebel movement, where he specialized in political proselytizing and making bombs, according to former guerrilla comrades.

"I am still a revolutionary, of course," said Mr. Rodríguez, 64, who remains a member of a party, Fatherland for All, on the left fringe of the government's coalition. "But it is under different conditions, in accordance with the realities of the day."

The irony of how the son of a humble Andean farmer became an idealistic guerrilla and, years later, rose to the upper echelon of a widely hailed company makes Mr. Rodríguez shake his head and smile. To be sure, he does not seem entirely comfortable poring through planning documents, but though he does not carry a rifle anymore, he still says he is fighting to shake up the system for the betterment of the poor.

Still, the reality is that today's rebels are his former oil executives. For more than two months they have been out in the streets protesting against Mr. Chávez and, by extension, Mr. Rodríguez's management of Petróleos de Venezuela S.A.

Indeed, thousands of Petróleos workers helped to topple Mr. Chávez for a few days in April, and then gave backbone to a national strike of several weeks that strangled oil exports to Venezuela's main customer, the United States.

Mr. Rodríguez may have once believed in hemispherewide revolution. But these days, as he looks out from his penthouse office, he sounds more like an unforgiving capitalist. He vows that the thousands of dissident workers who went on strike — and continue to strike — will never return to their jobs.

"Their movement seriously damaged the company and the country," Mr. Rodríguez said, his ire just slightly shaking his calm demeanor. "That is why I am indignant at what happened, because it makes our work so much harder. We have to reduce investments, and that means a loss of possibilities, a retreat for the country."

"There is no possibility of an amnesty whatsoever," he added.

Petróleos de Venezuela, once valued at $110 billion, is producing just half what it did before the strike, which ended in the non-oil sector last week after 63 days. Moribund oil fields are sanding up, losing the ability to produce oil; the company's reputation is in shambles; and the 9,000 workers Mr. Rodríguez has fired represent a loss of experience and skill.

Whether to take back striking workers is one of the critical decisions Mr. Rodríguez has made as he tries to guide Petróleos de Venezuela through venomous political waters into uncharted territory.

To his left are hard-liners in the governing party who believe Mr. Rodríguez was too lax in purging dissenters and too close to the global oil industry to be of much use to Mr. Chávez's reforms.

To his right are those who accuse him of allowing ideology to cloud logic, resulting in a scaled-down company that will generate far less wealth than before.

Those who know him see Mr. Rodríguez as independent, decisive and clear on how to reshape the company. He has a plan to break the company into eastern and western divisions, making the Caracas headquarters, where dissidents planned antigovernment walkouts, obsolete. He proposes reducing the company's scope, possibly selling off refineries and other assets overseas.

Mr. Rodríguez insisted that Venezuela would soon export as much petroleum as before the strike, about 2.7 million barrels a day, most to the United States. He suggested that as demand grows in the years to come, so would Venezuelan supply.

But the company he envisions would also conform more to Mr. Chávez's vision, to generate a steady stream of revenues for social programs. It would also continue forging ties with the Organization of the Petroleum Exporting Countries.

"I think that effectively, at least culturally, the true nationalization of petroleum is coming," Mr. Rodríguez said recently, though he emphasized that foreign companies would continue to operate here. The role of a company that controls such riches, he said in an interview, is to "incorporate that value of the natural resource for the maximum benefit."

But getting the company back to where it once was will be difficult — some say impossible — even for a longtime oilman who served as president and general secretary of OPEC before taking over the Venezuelan company last April.

"It is hard to see the company overcome this quantitative and qualitative setback," said Mazhar al-Shereidah, an oil economist who helped write oil regulations for the Chávez government. "He is not in charge of a healthy company. They are giving him a company, a body, that is in intensive care."

The company's 2003 budget is being cut by $2.7 billion, to about $6 billion, to offset the slide in revenue. Mr. Rodríguez acknowledges that investments that are crucial for exploration are being cut by 30 percent.

If he is strained by the Herculean task ahead, Mr. Rodríguez does not seem to show it. He has learned to be resilient.

"As I have said, everything you do as human beings, is a step forward," he explained. "You learn from the hard knocks, while someone who does not go through it might not find it so easy."

The hard knocks came in the 1950's when Mr. Rodríguez was a student agitator fighting against the strongman Marcos Pérez Jiménez. Even after Pérez Jiménez was overthrown in 1958, Mr. Rodríguez said he continued in the Venezuelan underground, pressing for change.

Accused of having detonated a fatal bomb blast, which he denies, Mr. Rodríguez fled into the mountains in 1964 and joined others intent on toppling the government. Former fellow fighters remembered Comandante Fausto, as he was known, as shrewd and tireless, excelling in combat and political work and spending his free time listening to classical music.

"He could move in any scenario," said Alberto Tirso, 61, a former comrade who now opposes the Chávez government. "He was a man of valor, very serene, a great reader. I remember he always carried four or five books in his knapsack."

But the revolution never caught on, and in 1979 Mr. Rodríguez was one of the last rebels to demobilize under a government amnesty. He became a lawyer and won a seat in the lower house of Congress where his interest in oil blossomed, leading to the chairmanship of the energy committee. When Mr. Chávez was elected president in 1998, he became minister of mines and energy.

"I have had the good fortune of being in different situations that have to do with petroleum," he said. "And now it is as an entrepreneur, a role I had never thought I would play in my life."

February 9, 2003 www.nytimes.com By JUAN FORERO

CARACAS, Venezuela, Feb. 8 — He wears pastel-colored suits and wire-rimmed glasses. His thinning hair is neatly combed. Restrained and a little stiff, he speaks in the dry tones and jargon-filled language of a technocrat on such obscure topics as 1958 American oil regulations or 1930's energy policies in Venezuela.

In short, he looks and sounds every bit the oil executive he is — the president of one of the largest, most complicated and, these days, most embattled companies in the world, Petróleos de Venezuela.

But make no mistake, Alí Rodríguez still sees himself as a revolutionary. His boss, after all, is President Hugo Chávez, whose sharp tongue and efforts to remake Venezuelan society have left the country deeply divided and on the edge of economic collapse.

Though his résumé makes no mention of it, Mr. Rodríguez has leftist, some would say radical, credentials. For 20 years, he was a clandestine agitator and a fighter in a Cuban-inspired rebel movement, where he specialized in political proselytizing and making bombs, according to former guerrilla comrades.

"I am still a revolutionary, of course," said Mr. Rodríguez, 64, who remains a member of a party, Fatherland for All, on the left fringe of the government's coalition. "But it is under different conditions, in accordance with the realities of the day."

The irony of how the son of a humble Andean farmer became an idealistic guerrilla and, years later, rose to the upper echelon of a widely hailed company makes Mr. Rodríguez shake his head and smile. To be sure, he does not seem entirely comfortable poring through planning documents, but though he does not carry a rifle anymore, he still says he is fighting to shake up the system for the betterment of the poor.

Still, the reality is that today's rebels are his former oil executives. For more than two months they have been out in the streets protesting against Mr. Chávez and, by extension, Mr. Rodríguez's management of Petróleos de Venezuela S.A.

Indeed, thousands of Petróleos workers helped to topple Mr. Chávez for a few days in April, and then gave backbone to a national strike of several weeks that strangled oil exports to Venezuela's main customer, the United States.

Mr. Rodríguez may have once believed in hemispherewide revolution. But these days, as he looks out from his penthouse office, he sounds more like an unforgiving capitalist. He vows that the thousands of dissident workers who went on strike — and continue to strike — will never return to their jobs.

"Their movement seriously damaged the company and the country," Mr. Rodríguez said, his ire just slightly shaking his calm demeanor. "That is why I am indignant at what happened, because it makes our work so much harder. We have to reduce investments, and that means a loss of possibilities, a retreat for the country."

"There is no possibility of an amnesty whatsoever," he added.

Petróleos de Venezuela, once valued at $110 billion, is producing just half what it did before the strike, which ended in the non-oil sector last week after 63 days. Moribund oil fields are sanding up, losing the ability to produce oil; the company's reputation is in shambles; and the 9,000 workers Mr. Rodríguez has fired represent a loss of experience and skill.

Whether to take back striking workers is one of the critical decisions Mr. Rodríguez has made as he tries to guide Petróleos de Venezuela through venomous political waters into uncharted territory.

To his left are hard-liners in the governing party who believe Mr. Rodríguez was too lax in purging dissenters and too close to the global oil industry to be of much use to Mr. Chávez's reforms.

To his right are those who accuse him of allowing ideology to cloud logic, resulting in a scaled-down company that will generate far less wealth than before.

Those who know him see Mr. Rodríguez as independent, decisive and clear on how to reshape the company. He has a plan to break the company into eastern and western divisions, making the Caracas headquarters, where dissidents planned antigovernment walkouts, obsolete. He proposes reducing the company's scope, possibly selling off refineries and other assets overseas.

Mr. Rodríguez insisted that Venezuela would soon export as much petroleum as before the strike, about 2.7 million barrels a day, most to the United States. He suggested that as demand grows in the years to come, so would Venezuelan supply.

But the company he envisions would also conform more to Mr. Chávez's vision, to generate a steady stream of revenues for social programs. It would also continue forging ties with the Organization of the Petroleum Exporting Countries.

"I think that effectively, at least culturally, the true nationalization of petroleum is coming," Mr. Rodríguez said recently, though he emphasized that foreign companies would continue to operate here. The role of a company that controls such riches, he said in an interview, is to "incorporate that value of the natural resource for the maximum benefit."

But getting the company back to where it once was will be difficult — some say impossible — even for a longtime oilman who served as president and general secretary of OPEC before taking over the Venezuelan company last April.

"It is hard to see the company overcome this quantitative and qualitative setback," said Mazhar al-Shereidah, an oil economist who helped write oil regulations for the Chávez government. "He is not in charge of a healthy company. They are giving him a company, a body, that is in intensive care."

The company's 2003 budget is being cut by $2.7 billion, to about $6 billion, to offset the slide in revenue. Mr. Rodríguez acknowledges that investments that are crucial for exploration are being cut by 30 percent.

If he is strained by the Herculean task ahead, Mr. Rodríguez does not seem to show it. He has learned to be resilient.

"As I have said, everything you do as human beings, is a step forward," he explained. "You learn from the hard knocks, while someone who does not go through it might not find it so easy."

The hard knocks came in the 1950's when Mr. Rodríguez was a student agitator fighting against the strongman Marcos Pérez Jiménez. Even after Pérez Jiménez was overthrown in 1958, Mr. Rodríguez said he continued in the Venezuelan underground, pressing for change.

Accused of having detonated a fatal bomb blast, which he denies, Mr. Rodríguez fled into the mountains in 1964 and joined others intent on toppling the government. Former fellow fighters remembered Comandante Fausto, as he was known, as shrewd and tireless, excelling in combat and political work and spending his free time listening to classical music.

"He could move in any scenario," said Alberto Tirso, 61, a former comrade who now opposes the Chávez government. "He was a man of valor, very serene, a great reader. I remember he always carried four or five books in his knapsack."

But the revolution never caught on, and in 1979 Mr. Rodríguez was one of the last rebels to demobilize under a government amnesty. He became a lawyer and won a seat in the lower house of Congress where his interest in oil blossomed, leading to the chairmanship of the energy committee. When Mr. Chávez was elected president in 1998, he became minister of mines and energy.

"I have had the good fortune of being in different situations that have to do with petroleum," he said. "And now it is as an entrepreneur, a role I had never thought I would play in my life."

Sunday, 9 February, 2003, 00:58 GMT news.bbc.co.uk The opposition says many oil-workers are still on strike

More than 100,000 people have marched through the capital, Caracas, to protest against the policies of President Hugo Chavez.

Blowing whistles and banging drums, protesters took to the streets to show solidarity with the 9,000 workers who were sacked from the state-owned oil company PDVSA during the strike.

We're convinced that the oil industry cannot work without us

Reinaldo Michelena, sacked oil worker

The latest rally comes only days after President Chavez declared a two-month long anti-government strike defeated.

The strike aimed at ousting the oil-rich country's president has weakened since it began on 2 December - but PDVSA strikers said on Saturday that their action could still bring down the government.

"We're convinced that the oil industry cannot work without us," Reinaldo Michelena, one of those sacked, told Reuters news agency.

"We'll keep on with this strike because the only way to get rid of this government is hitting at the economy."

Marching under the national flag, protesters chanted "Chavez, you're a thief! PDVSA is not yours, it's everyone's!"

Currency controls

Mr Chavez, in office since 1998, faces a broad alliance of political parties, unions and private businesses who accuse him of authoritarianism and mismanaging the economy.

Strike crisis

At least seven people killed in strike-related violence

Oil exports still a fraction of the pre-strike volume

Has cost the government at least $4bn

Having fired the PDVSA strikers and restructured the company, he is resisting calls for fresh elections and refuses to amnesty the strikers whom he brands as "terrorists".

He says that most of PDVSA's 40,000 employees have returned to work.

But the opposition denies this - they say thousands are still on strike in support of their sacked colleagues.

The strike has battered Venezuela's economy, slashing its vital crude oil exports and causing severe domestic fuel shortages.

The president has brought in tight foreign exchange curbs and price controls to shore up reserves and the national currency, the bolivar.

Oil squeeze

Announcing the controls on television this week, he waved a copy of Venezuela's penal code at viewers and accused opposition leaders of planning to take hard currency out of the country.

"They wanted to leave us without dollars, so we took away the key," he said.

Mr Chavez - a former paratrooper and coup-leader - models himself on 19th Century Venezuelan nationalist hero Simon Bolivar and counts Cuban leader Fidel Castro among his friends.

He maintains a base of support among Venezuela's poor but has antagonised nearly every other stratum of society.

Government claims that oil output has now reached nearly 2 million barrels a day and exports are at 700,000 barrels per day have been challenged by the opposition.

They estimate that output is still at a third of the 3.1 million barrels Venezuela produced in November before the strike. Average exports then were about 2.7 million barrels a day.