Posted on 12/13/2002 12:31:18 PM PST by Axion
SITUATION REPORTS - December 13 2002
18:10 GMT - Caracas daily TalCual reports that refining units at Petroleos de Venezuela's (PDVSA) El Palito refinery have suffered substantial damage as a result of failed efforts by unqualified personnel to restart the facility. Unleaded gasoline stocks have been contaminated with leaded gasoline, which means that thousands of vehicles that operate with unleaded gasoline will be damaged in coming days. 17:40 GMT - Venezuelan air force Brig. Gen. Pedro Pereira told Caracas daily El Nacional on Dec. 13 that air force intelligence sent him classified reports two days ago confirming the entry into Venezuelan territory of small groups of rebels from Colombia's Revolutionary Armed Forces of Colombia (FARC) and National Liberation Army (ELN). Pereira said the FARC and ELN rebels have crossed into the states of Zulia and Tachira and are being transported to Caracas by radical members of the pro-Chavez Fifth Republic Movement (MVR) party. Pereira also said intelligence reports indicate that President Hugo Chavez has delegated control of armed elements of the pro-government Bolivarian Circles to Interior and Justice Minister Diosdado Cabello and Eliezer Otaiza, the former chief of the ministry's political police (DISIP). 17:35 GMT - Venezuelan army division Gen. Enrique Medina Gomez, the most visible leader of the dozens of dissident military officers who have been encamped at Plaza Altamira in Caracas for nearly six weeks, told El Universal on Dec. 13 that the goal of the political opposition now should be to maintain the current national strike at all costs until President Hugo Chavez is forced to resign. Medina Gomez added that if Chavez is forced out, it likely will be necessary to "dramatically reduce" the size of the army and national guard and to retire all officers and lower-ranking personnel who have supported him. 17:25 GMT - Venezuelan army Col. Aguedo Rogelio, former intelligence chief for the National Armed Forces Joint Command (CUFAN), claimed late Dec. 12 that loyalist army officers at Fort Tiuna in Caracas have distributed more than 400 FAL 7.62 mm assault rifles to civilian supporters of President Hugo Chavez. 17:22 GMT - U.S. Ambassador to Venezuela Charles Shapiro said Dec. 12 that the Bush administration is "very worried" about the escalating political crisis in Venezuela, according to Caracas daily El Universal. Shapiro also blamed both the Chavez government and its political opponents for maintaining "intransigent positions" that are pushing Venezuela closer to widespread violence. 17:15 GMT - In a speech broadcast on government-owned Venezolana de Television, Interior and Justice Minister Diosdado Cabello ordered civilian supporters of President Hugo Chavez to form a "civil shield" around Miraflores presidential palace to protect the president. The palace is heavily guarded by national guard and army units, but Cabello urged supporters to take the streets around the palace to show their loyalty to Chavez, according to Caracas daily El Universal. 16:47 GMT - Petroleos de Venezuela sources say the company's normal daily production of some 2.7 million barrels per day has been cut back to between 500,000 to 700,000 bpd. The sources added that synthetic crude production of some 400,000 bpd by foreign oil companies operating in Venezuela also has declined significantly due to severe disruptions in natural gas supplies. 16:44 GMT - A senior official at the U.S. Department of Energy told Reuters that the Bush administration is willing to tap U.S. strategic oil reserves to help any American oil companies whose refining operations are being affected by Petroleos de Venezuela's strike. The source added that the U.S. government also is willing to renegotiate contracts with oil companies that were providing Venezuelan crude oil to the U.S. Strategic Petroleum Reserve. 16:42 GMT - The Hovensa oil refinery in St. Croix -- which normally produces 495,000 barrels a day -- has been forced to scale back its operations because it is not receiving crude supplies from Venezuela. Hovensa is a 50-50 joint venture between PDVSA and Amerada Hess. 16:35 GMT - Venezuelan President Hugo Chavez throughout the week has insisted that the strike by Petroleos de Venezuela has not affected oil production, refining and export operations. However, PDVSA President Ali Rodriguez acknowledged Dec. 13 that the strike is hurting the company financially and reducing the government's revenues from crude oil sales and royalty payments from foreign companies. Rodriguez also told Caracas daily El Universal that Venezuela's commercial relations with clients in other countries also are being damaged. 16:25 GMT - Luis Clavier, central region manager for Petroleos de Venezuela affiliate Deltaven, told Caracas daily El Universal on Dec. 13 that gasoline stocks at Central Venezuela's three distribution centers in Barquisimeto, El Palito and Yagua are nearly empty. He adds that most of the region will be "without a single drop of gasoline in four days." Meanwhile, Angelina Martino, president of the Caracas-area gasoline distribution company Metrogas, reported that the gasoline tank farm at Guatire, some 25 miles east of Caracas, has run out of unleaded stocks. The tank farm at Puerto La Cruz reportedly still has gasoline stocks and is operating at about 40 percent capacity, but the tank farm at San Tome is nearly out of diesel. 16:24 GMT - Venezuela's government is trying to find tanker operators willing to transport gasoline from Petroleos de Venezuela (PDVSA) tank farms located on the nearby islands of Curacao and Bonaire, shipping sources tell Stratfor. However, the government so far has been unable to charter tankers because it lacks personnel experienced in such transactions, and because independent tanker owners are unwilling to risk their vessels without coverage that international insurers are refusing to provide. 16:11 GMT - Petroleos de Venezuela (PDVSA) sources report that since the oil industry went on strike a week ago, only three out of 42 oil tankers that were scheduled to transport loads to Venezuelan refineries and international clients have managed to set sail, according to Caracas daily El Universal. The first tanker was the Four Astra, with 300,000 barrels of diesel bound for Cuba. The second was the Josefa Camejo, which traveled to the United States with 550,000 barrels of crude oil reportedly destined for Citgo. The third tanker was the Marshall Shuykod, transporting 350,000 barrels of crude oil to the Amuay refinery on Venezuela's Paraguana Peninsula. A fourth tanker, the Bahamas-flagged Kioma Spirit, is slowly being loaded at the La Salinas terminal in Lake Maracaibo, while a fifth tanker is reportedly is being loaded at an eastern Venezuela terminal, according to Nelson Moreno, mayor of the Anzoategui state community of Sotillo and a member of the ruling Fifth Republic Movement (MVR) party. 16:02 GMT - Anders Baardvik, the Latin America manager for the International Association of Independent Tanker Owners (Intertanko), told Caracas daily El Universal Dec. 13 that the organization is warning all of its member tanker owners to "exercise extreme legal security with its local agents (in Venezuela) before entering oil terminals in the area." International insurers are closely monitoring the situation, he added, since it "affects the security and economy of tankers." 16:00 GMT - Venezuela's government has convoked a closed session of the Permanent Council of the Organization of American States in Washington to discuss the escalating political crisis in that country, according to Stratfor sources at the OAS. 15:50 GMT - Venezuelan Vice President Jose Vicente Rangel told reporters in Chile's capital city of Santiago on Dec. 12 that President Hugo Chavez is at growing risk of being assassinated by the opposition, according to DPA. However, Venezuelan military intelligence (DIM) sources in Caracas told Stratfor on Dec. 13 that Chavez is at much greater risk of being assassinated by "ultra-radicals within his government than by political opponents." They added that Chavez is surrounded by a heavy contingent of security guards, including Cuban nationals sent to Caracas by Fidel Castro for the specific purpose of protecting Chavez. As a result, these sources believe that it's more likely that Chavez could be the victim of a palace coup than an external assassination attempt. 15:47 GMT - The national terminal at Simon Bolivar Airport in the Maiquetia district of Caracas is operating at only 10 percent of normal flight volume, according to commercial aviation sources at the airport. United Airlines has suspended its flights to Venezuela until Dec. 16, but American Airlines says its flights are departing. 15:40 GMT - Venezuelan media owners in Caracas called a press conference for the international news media on Dec. 13 to explain why they believe President Hugo Chavez is targeting their television stations and newspapers, according to Stratfor sources who were present. Many foreign reporters have challenged what they describe as lack of objectivity in reporting on the crisis in Venezuela.
18:15 GMT - White House spokesman Ari Fleischer said Dec. 13 that the United States "is convinced that the only peaceful and politically viable road" to end the crisis in Venezuela is to hold early elections, according to Spanish news agency EFE. Under the current Venezuelan constitution, President Hugo Chavez would remain in power until the end of 2006 and would not be subject to a recall election before August 2003.
….. The nation's gasoline inventories are down from a year ago, but the inventoried volumes increased during the most recent week and are pretty much in line with the five-year average. Refineries are making a half-million barrels per day more gasoline than they were last year, supplemented by plentiful imports. "The market is well-supplied," Kloza said. Sustaining a price rally at the pump this time of year would be difficult, unlike during March or April when a Venezuelan strike would be cause for alarm.
The wholesale markets were reacting not only to Venezuela's woes but to news that Saudi Arabia will cut back on January crude output, to reports of a problem with a catalytic cracker in Valero's Texas City refinery, and the typical pre-weekend jitters when the war drums are beating, he said. Companies with significant exposure to Venezuelan crude reductions include the Lyondell-Citgo refining joint venture in Houston, Murphy Oil, Exxon Mobil, Valero, ChevronTexaco and ConocoPhillips, according to Tyler Dann, analyst for Banc of America Securities.
Tulsa, Okla.-based Citgo, owned by the Venezuelans, is one of the nation's biggest gasoline marketers. The situation in Venezuela is so serious that Dann wouldn't be surprised to see the United States shipping gasoline there.***
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