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Damaged wells cut Ecuador oil pumping by half: official
Agence France-Presse via Servihoo.com
Ecuador’s state oil firm was producing at half capacity and could face problems returning to full capacity because of damage caused during six days of bitter protests, Energy Minister Ivan Rodriguez said. Production resumed Sunday after President Alfredo Palacio deployed troops to Ecuador’s Amazon basin and protesters agreed to talks with government officials in Quito.
The talks made no headway on Monday, negotiators said, and will pick up Tuesday, with protesters sticking to their demands for a larger slice of oil wealth and the exclusion of US-based Occidental Petroleum (Oxy) from Ecuador. …
Some of the wells were so badly damaged “it is possible they cannot be recovered,” he said, adding that state-owned Petroecuador was producing 50 percent of its normal 201,0000 barrels per day since the trouble started a week ago. …
“We are insisting on ending the contract with Oxy, and renegotiating oil contracts with the other multinationals,” said Guillermo Munoz, governor of Sucumbios province and one of the protest leaders. …
Private companies produce 340,000 barrels a day, but their output was cut to about 150,000 barrels because of the dispute, said Rene Ortiz, a spokesman for the private oil firms. Petroecuador’s production halted completely Thursday after protesters from the region took over a dozen oil wells and two regional airports and blocked roads.
Clashes between demonstrators and security forces left at least 60 injured, said Munoz, who was arrested on Friday, along with the mayor of Lago Agrio, the Sucumbios capital, for allegedly leading the protests.
An IMF mission headed by Trevor Alleyne met with Economy Minister Magdalena Barreiro here to discuss Ecuador’s financial wellbeing but without making any statements afterward.
(23 August 2005)
Ecuador Government, Provincial Leaders Await Oil Companies Response
Staff, Prensa Latina (Cuba)
QUITO–Representatives of the Ecuadorian government and provinces Orellana and Sucumbios are awaiting Wednesday oil companies´ response to their demands that they contribute resources to the Amazon territories.
Delegates at the Biprovincial Assembly left talks last night as oil company executives for both Amazon territories failed to appear to reply the counterproposal previously made.
They expect the companies to report Wednesday whether they will agree to contribute the resources to pave 260 kilometers of highways (130 kilometers for each province) and allocate 16 percent of the taxes they pay to Treasury, to those territories.
Authorities on strike have also demanded the use of local labor and transportation.
“If the companies remain silent, we will definitively leave the talks and go on strike again,” emphasized Sucumbios Governor Guillermo Gomez.
In the face of executives´ absence and the appearance of their representative Rene Ortiz eight hours later, mediator and Pichincha Governor Ramiro Gonzalez described the businessmen´s attitude as unjustifiable.
“The arrogance of the oil companies is unacceptable, the country needs a reply; it is completely unacceptable for Ecuador to be held in suspense by private interests. The nation should be respected,” emphasized Gonzalez.
The talks on Tuesday, held in San Vicente ranch in this capital, were attended by Government ministers Mauricio Gandara (Public Works), Derliz Palacios (Labor), Galo Chiriboga, and over 30 representatives from Orellana and Sucumbios.
Until now both provinces have observed a truce in the strike begun on August 15, which has caused great economic loss to the country because of its effects on oil production.
(25 August 2005)
Chávez taunts US with oil-for-poor offer
Duncan Campbell, The Guardian
Venezuelan president hits back at assassination remarks with offer of cheap petroleum for poor Americans
President Hugo Chávez of Venezuela hit back vigorously at calls by an ally of President George Bush for his assassination by offering cheap petrol to the poor of the US at a time of soaring fuel prices.
In a typically robust response to remarks by the US televangelist Pat Robertson, Mr Chávez compared his detractors to the “rather mad dogs with rabies” from Cervantes’ Don Quixote, and unveiled his plans to use Venezuela’s energy reserves as a political tool.
“We want to sell gasoline and heating fuel directly to poor communities in the United States,” he said.
Mr Robertson’s remarks have threatened to inflame tension between the US and one of its main oil suppliers. Yesterday the religious broadcaster apologised for his remarks.
(25 August 2005)
Two fingers to America
Richard Gott, The Guardian
He’s a friend of Fidel Castro, a fierce critic of the war in Iraq, and wants to spread revolutionary fervour throughout South America. Venezuela’s president, Hugo Chávez, has long been a thorn in the side of the US – a fact highlighted this week when televangelist Pat Robertson called for his assassination.
(25 August 2005)
Good backgrounder.
Chávez seeks influence with oil diplomacy
Danna Harman, Christian Science Monitor
…Chávez, whom Christian televangelist Pat Robertson says the US should assassinate, has been traveling the hemisphere offering preferential oil deals, barters, and loans to leftist and left-of-center governments. In the past 30 days, the leader of the world’s fifth-largest oil exporting country, has inked deals with Argentina, Brazil, Uruguay, and Paraguay. Thirteen Caribbean nations signed a deal for cheap oil in June. And since April, Cuba has been getting almost all of its oil from Venezuela in exchange for doctors and gym teachers.
It is, Chávez says, his way of helping neighboring countries cut energy costs and improve living standards in the region. “Altruism,” says Eric Wingerter, a spokesman at the Venezuela Information Office in Washington, D.C., simply. “This is part of larger process involving regional solidarity and helping other countries economically.”
But critics charge Chávez is buying friends and influence with the objective of extending his regional hegemony – and undermining the US.
(25 August 2005)
Oil Fat Cats vs. Hugo Chavez
Juan Gonzales, New York Daily News via Common Dreams
…Pat Robertson looks at Chavez and sees a devilish danger. He wants our government to “take him out.” Over at the White House, Bush and his aides may use more restrained language, but their goals are not much different.
But there’s a whole different view down in Latin America, where a half-dozen nations have seen liberal and populist governments swept into office in recent years.
Down there, Chavez has become the new miracle man of oil. Unlike Exxon/Mobil and the Big Oil fat cats, who wallow in their record profits while the rest of us pay, Chavez is spreading the wealth around.
A dangerous man, indeed.
(25 August 2005)
Nigerian plan brings threat of petrol price rise
Dino Mahtani in Lagos, Financial Times
Nigeria, the world’s eighth-largest oil exporter, was on Wednesday braced for a possible 60 per cent increase in petrol prices after the authorities signalled their intention to press ahead with badly needed but deeply unpopular liberalisation.
A growing gap between fixed pump prices and soaring fuel import bills has threatened to bankrupt the country’s state-run energy company in spite of large windfalls from rising oil prices.
…Nigerian officials have said that in spite of its massive oil wealth, social expenditure needs preclude it from investing more in the oil sector. The finance minister has said that Nigeria’s population of 130m means it has a per capita income on par with some of Africa’s poorer countries.
The country’s anti-corruption commission, however, says that much of the $340bn Nigeria has earned from oil exports in the last 40 years has been squandered through corruption.
(24 August 2005)
Killing the dollar in Iran
Toni Straka, Asia Times (guest commentary)
Could the proposed Iranian oil bourse (IOB) become the catalyst for a significant blow to the influential position the US dollar enjoys? Manifold supply fears have driven the price of crude oil to its recent high of US$67.10 – only a notch below its highest price in inflation-adjusted dollar terms.
With the world facing a daily bill of roughly $5.5 billion for crude oil at current price levels, it becomes apparent that sellers and purchasers of the black gold are looking into all ways that could lead to a financial improvement on their respective sides.
Toni Straka is a Vienna, Austria-based independent financial analyst and portfolio manager, who worked as a financial journalist for over 15 years and now evaluates global market trends. He runs a blog, The Prudent Investor, where this piece first appeared
(26 August 2005)
Iran in the Crosshairs
Ryan McGreal, RaiseTheHammer
Starting in 2006, Iran will start up an “oil bourse”, or a stock exchange for trading energy, that will be based on the euro, not the US dollar. While this may seem innocuous, it will be a grave risk to continued American global hegemony. …
One of the major unstated reasons the United States invaded Iraq was to stop Saddam Hussein from trading oil for euros, which he had begun in 2000. Hussein actually made more money selling oil for euros, as the euro appreciated 17 percent against the dollar between 2000 and 2003. Other countries in the region, particulary Iran and Syria, began public musing about switching from dollars to euros around the same time.
All three countries were subject to a barrage of threats from the United States government, but only Iraq went through with the switch, and it was summarily invaded. One of the US government’s first acts in Iraq was to switch oil sales back to dollars. …
(22 August 2005)
GM, Ford Motor Debt Ratings Cut to Junk by Moody’s
Bill Koenig, Bloomberg
General Motors Corp. and Ford Motor Co., the two biggest U.S. automakers, were lowered to junk by Moody’s Investors Service following two quarters of losses at both companies’ North American auto operations.
(24 August 2005)
Stagger on, weary Titan
The US is reeling, like imperial Britain after the Boer war – but don’t gloat
Timothy Garton Ash, Guardian (commentary)
…Meanwhile, oil prices of more than $60 a barrel put the price of petrol at American pumps up to nearly $3 a gallon for basic unleaded fuel. For someone from Europe this is still unbelievably cheap, but you should hear the shrieks of agony here. “Gas prices have changed my life,” moaned a distressed Californian commuter. If higher energy prices persist, they threaten not just a still vibrant economy but a whole way of life, symbolised by the Hummer (in both its civilian and military versions). Besides instability in the Middle East, the main force pushing up oil prices is the relentless growth of demand for energy from the emerging economic giants of Asia. The Chinese go around the world quietly signing big oil supply deals with any oil-producing country they can find, however nasty its politics, including Sudan and Iran. When a Chinese concern tried to buy a big California energy company, that was too much – American politicians screamed and effectively blocked the deal.
…None of this is to suggest that the United States will decline and fall tomorrow. Far from it. After all, the British empire lasted for another 40 years after 1905. In fact, it grew to its largest extent after 1918, before it signed its own death warrant by expending its blood and treasure to defeat Adolf Hitler (not the worst way to go). Similarly, one may anticipate that America’s informal empire – its network of military bases and semi-protectorates – will continue to grow. The United States, like Edwardian Britain, still has formidable resources of economic, technological and military power, cultural attractiveness and, not least, the will to stay on top.
…. The Bush administration’s national security strategy makes no bones about the goal of maintaining military supremacy. But whether the “American century” that began in 1945 will last until 2045, 2035 or only 2025, its end can already be glimpsed on the horizon.
If you are, by any chance, of that persuasion that would instinctively find this a cause for rejoicing, pause for a moment to consider two things: first, that major shifts of power between rising and falling great powers have usually been accompanied by major wars; and second, that the next top dog could be a lot worse.
(25 August 2005)
Bankruptcies in U.S. surge to record high
Jeannie Aversa, Associated Press via BusinessWeek
The number of bankruptcies in the United States surged to an all-time high in the second quarter of this year as financially troubled consumers scrambled to file before a rewrite of bankruptcy laws takes full effect. Bankruptcy filings to federal courts in the April-to-June quarter totaled 467,333, according to data released Wednesday from the Administrative Office of the U.S. Courts. That marked a record number of filings made in any quarter. …
“We are seeing the effect of consumers rushing to file now in order to avoid the impact of the new law,” said Samuel Gerdano, executive director of the American Bankruptcy Institute. He said the new law goes fully into effect on Oct. 17. …
Supporters say new provisions were needed to curb abuses of the bankruptcy system. Opponents claims the changes will be especially hard on low-income working people, single mothers, minorities and the elderly and would remove a safety net for those who have lost their jobs or face mounting medical bills.
The record 467,333 bankruptcy filings in the second quarter surpassed the previous quarterly high of 440,257 filings in the second quarter of 2003, said Nathalie Martin, a resident scholar at the American Bankruptcy Institute.
(24 August 2005)
