sg.biz.yahoo.com Tuesday February 4, 10:26 PM

CARACAS -(Dow Jones)- Venezuela's government will import more than 12 million barrels of gasoline in February in an effort to combat a gasoline shortage caused by a strike at state-owned oil monopoly Petroleos de Venezuela, the company president said in a report by state-run news agency Venpres Tuesday.

"We foresee imports of more than 12 million barrels of gasoline this month in order to maintain normal supply in the domestic market," Rodriguez was quoted as saying. Rodriguez couldn't be reached for additional comment.

Rodriguez didn't say how much the purchase of the gasoline on the spot market would cost. However, in a briefing with members of the foreign press last week, Rodriguez said the total cost of importing 11 million barrels of gasoline during January stood at $442 million.

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AdultsWith the strike at day 65 Tuesday, Venezuela's crude oil output is around 1.2 million barrels per day (b/d), according to dissident staff of PdVSA.

The majority of the dissident staff who joined a general strike Dec. 2 have already been fired by President Hugo Chavez. The strike was aimed at forcing Chavez to resign followed by early elections. Chavez, however has refused to give in and vowed to revamp PdVSA.

Currently, international diplomatic efforts have been stepped up in an effort to broker a deal with the political opposition and the government. The strike in sectors other than oil - has eased.

By Fred Pals, Dow Jones Newswires; fred.pals@dowjones.com; 58-212-564-1339

www.morningstar.ca 4 Feb 03(6:58 AM) |  E-mail Article to a Friend

LONDON (Reuters) - World oil prices were steady on Tuesday as traders awaited Secretary of State Colin Powell's presentation to the U.N. Security Council on Wednesday that could press the case for war against Iraq.

Powell has said he would provide "sober and compelling proof" that Baghdad was hiding banned weapons from U.N. arms inspectors. The U.S. has vowed to disarm Iraq, by force if necessary. He is due to speak at a Wednesday session beginning at 1530 GMT (1030 EST).

Benchmark Brent crude was up two cents at $30.27 a barrel while New York light crude was four cents lower at $32.72.

Lawrence Eagle, analyst with brokerage firm GNI-Man in London, said the market was unlikely to shift much either way before Powell speaks.

"There's no more news in the market at the moment to move prices," he said.

OPEC WORRIED ABOUT OIL GLUT

With crude output from oil exporter Venezuela creeping higher as the protracted strike there starts to unravel, OPEC officials are starting to fret over a possible oil surplus in the second quarter that may force.

OPEC president Abdullah al Attiyah said on Tuesday a resumption of oil exports from Venezuela may force the cartel to cut second-quarter supplies, but policy was uncertain due to the threat of war in Iraq.

Asked whether increased Venezuelan exports made it more likely that OPEC would have to cut production in the second quarter, Attiyah said: "Yes, why not?"

OPEC ministers will next meet in Vienna on March 11 to discuss policies and output for the next quarter.

Iran's Oil Minister Bijan Zanganeh said OPEC faced two choices at its March meeting, to maintain its official production ceiling or cut output.

"The Iranian minister has summed up OPEC's position, to do something or not," said Eagles.

OPEC ministers had agreed at an emergency session in January to increase its official production limits by 1.5 million barrels per day (bpd) to 24.5 million bpd from February 1 to counter the Venezuelan shortage.

President Hugo Chavez, under pressure from opposition strike leaders to resign, said at the weekend Venezuela was pumping close to 1.8 bpd, up from a low of 150,000 bpd after the strike began in December and more than half of the 3.1 million bpd pumped in November.

Strikers said on Monday that crude output was running at 1.2 million bpd.

Data from shipping agents indicated Venezuela's oil exports rose to 890,000 bpd in the week to February 1 from 550,000 bpd the previous week.

Crude prices are however hovering close to 26-month highs due to the Venezuela strike and fears of a war in Iraq, which traders say would disrupt supplies not only from Iraq but also from other producers in the oil-rich Middle East.

www.ameinfo.com Posted: February 4th, 2003 at 15:24 - UAE local time (GMT+4)

Despite negative international media perceptions, the Middle East's shipping industry is very much alive and well, according to a leading global industry consultant.

Dubai, UAE Addressing the Seatrade Middle East Maritime conference, which runs at the Grand Hyatt Dubai Conference Centre until Wednesday night, Fred Doll, Managing Director of the UK's Doll Shipping Consultancy, said analytical trends belie international media views that the regional industry is suffering from political uncertainty, developing energy sources competition and fundamental threats to its future world role. In the region's favour, said Doll, is the fact that it is the largest single source of oil and retains more than 80% of spare crude production. The region invests heavily in refining, is committed to the tanker sector, including new- buildings, is expanding into LNG shipping, invests in dry bulk shipping, and has an orderly approach to planning and investment decisions. “The Middle East retains a fundamental importance in oil markets,” said Doll. “Oil market security comes from spare capacity that can enter markets at short notice. Most of the world's spare capacity resides in the Middle East and no other region can substitute. Interestingly, since December, Middle East oil is providing stability in world markets. Venezuela, not the Middle East, is a source of political instability in oil markets in recent months.” Doll, a member of The Nautical Institute and The Institute of Petroleum, added that investments in oil refining sectors will ensure that the Middle East can provide high spec, low sulphur products to Europe and the US. “In the Middle East, strategic commitment to the tanker sector provides base transportation in the event of crisis and a market hedge in normal markets. This commitment ensures that marine industry skills in the region remain second to none, and captures value by integrating along the supply chain,” Doll added. “Gas companies in the region are applying similar reasoning to new business in the LNG sector.” Doll Shipping Consultancy provides market analysis, project evaluation, e-commerce expertise, and strategic planning assistance to shipping companies and financial institutions worldwide. Over 400 delegates from 27 countries are attending Seatrade Middle East Maritime, which on Wednesday focuses on Finance & Insurance, Purchasing, Safety & the Environment and Maritime Infrastructure. An industry exhibition being held alongside the event features 85 exhibitors from 17 countries. Ends For further information: Barbara Saunders, MCS/Action, PO Box 20970, Dubai, United Arab Emirates. Tel: +9714 3902961; fax: +9714 3908161. Or visit Seatrade online at: www.seatrade-middleeast.com

economictimes.indiatimes.com ECONOMIST INTELLIGENCE UNIT ECONOMICTIMES.COM[ TUESDAY, FEBRUARY 04, 2003 03:26:41 PM ]

The Economist Intelligence Unit's price index for hard commodities — industrial raw materials (IRM) — is forecast to continue 2002's slow recovery over the next two years, with gains of 4 per cent in 2003 and 5.4 per cent in 2004. However, crude oil, which is excluded from the IRM index as it would dominate movements in the trade-weighted measure, is forecast to see its price stabilise in 2003 before falling sharply in 2004.

"Having been inflated, initially by fears of a US-led attack on Iraq and then by supply disruptions in Venezuela, crude oil prices will be softening by mid-2003," said Matt Parry, senior commodities editor at the Economist Intelligence Unit. "This reflects a dismantling of the war premium — assuming a resolution of the crisis — and a reassertion of a global oversupply of oil on market sentiment. In this environment, weakly reviving global demand will be outweighed by higher supply as OPEC scrambles to reclaim lost market share. The net effect will be an average price for dated Brent Blend of $24.5/barrel in 2003, falling below $20/barrel in 2004."

Having recovered somewhat from 2001's price crash, when the IRM index fell nearly 10 per cent, some hard commodity prices have firmed in 2002. Higher prices for wool, natural rubber and nickel (the only base metal to rise) offset lower prices for cotton and most base metals (which continued their two year decline). Although the IRM index will recover in 2003 and 2004, EIU has downgraded the price forecasts for natural rubber and fibres.

A closer look at the quarterly pattern for prices across the IRM index highlights some interesting findings. Prices are forecast to stabilise in the first quarter of 2003, before falling in the second and third quarters, as the US-led showdown with Iraq softens demand in many key hard commodity markets. Prices will recover from the fourth quarter of 2003, picking up a strong head of steam as the IRM index rises uninterrupted through to the first quarter of 2005. Indeed, this one-and-a-half-year period is unique in many respects as all three key segments of the IRM index (natural rubber, fibres, and base metals) rise unabated on a quarter-on-quarter basis.

For specific commodities, the Economist Intelligence Unit's current expectations are as follows:

Aluminium: Continued over-investment in production capacity will mean the aluminium industry remains plagued by oversupply over the next two years, driving prices down.

Copper: The modest global economic recovery, producing stronger copper demand and contributing to lower stock levels, will provide steady support to prices throughout 2003 and 2004.

Crude oil: Crude oil prices will remain high while the threat of a US-led attack on Iraq persists, before falling once more, as artificially high prices in 1999-2002 have led to massive over-investment which will severely test OPEC's market power.

Fibres: Higher cotton consumption, in both 2002/03 and 2003/04, in comparison with present production forecasts is certain to reduce cotton stocks, driving prices up. Wool prices will remain high over the next two years as undersupply persists.

Lead: Lead prices will rise, albeit slowly, over the next two years, as the forecast recovery in demand slowly overtakes supply.

Natural rubber: The demand upturn in early 2002 proved short-lived; although prices are forecast to rise in 2003 and 2004, EIU take a more bearish view of prospects than it did in October's report.

Nickel: Prices will fall slightly over the next two years as additional capacity comes on stream in 2004.

Tin: From an excessively low level in mid-2002, prices will rise through 2003 and 2004, under pressure of recovering demand. EIU takes a more bullish view of price prospects than in the October report.

Zinc: Zinc prices will rise from mid-2003 through 2004, as strong demand growth increasingly diminishes the market's recent over-supply.

 http://www.quicken.com/investments/news_center/story/?story=NewsStory/dowJones/20030204/ON200302040316000262.var&column=P0DFP

Tuesday, Febuary 4, 2003 03:16 AM ET  Printer-friendly version   DOHA, Qatar -- Organization of Petroleum Exporting Countries President Adbullah bin Hamad al-Attiyah said Tuesday that Venezuela's increasing oil production is a sign that may prompt OPEC to consider a production cut when it meets March 11.

Asked about the possibility of a reduction in the group's overall ceiling in the coming months, given Venezuela's higher production, he said "why not?"

Mr. Al-Attiyah noted that world oil demand is expected to slow by around two million barrels a day in the second quarter, and this will combine with increasing Venezuelan output, so OPEC will try to strike a balance between supply and demand.

Venezuela's crude output rose to 1.22 million barrels a day as of Monday, from around 1.1 million barrels a day over the weekend, dissident staff of Venezuela's state-owned oil monopoly Petroleos de Venezuela said in a daily report.

Mr. Al-Attiyah was speaking to reporters ahead of a natural-gas conference.

-Abdulla Fardan; Dow Jones Newswires; 00973-965-865-6; Abdulla.Fardan@ Dowjones.com