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Gas Lines Form Amid Strike in Venezuela

February 7, 2003

CARACAS, Venezuela (AP) _ Venezuelan motorists waited for hours to fill up at gasoline stations Friday _ a sign life has been slow to return to normal after a two-month strike that failed to oust President Hugo Chavez and left the economy in shambles.

Thousands of employees at the state oil monopoly, Petroleos de Venezuela S.A, are still on strike or have been fired by Chavez. The government has raised crude oil production to about a third of normal, but refineries are largely idle.

Energy and Mines Minister Rafael Ramirez said Friday that gasoline production was 150,000 barrels a day, compared to 250,000 before the strike. He said Venezuela would import 12 million barrels of gasoline this month to make up for shortages.

Venezuela _ the world’s fifth-largest oil exporter _ has spent more than $500 million a day on fuel imports since the strike began Dec. 2. Because of the dependency on imports, ``the situation with gasoline goes up and down,″ Ramirez said.

Hundreds of drivers joined lines stretching for several miles at Caracas service stations, most of which were dry and waiting for deliveries. Earlier this week, it took 20 minutes at most to fill up in Caracas, though huge lines had persisted in the rest of the country.

``The strike is over but we are still going through a critical moment,″ said Wilmer Acevedo, 30, a tow truck driver waiting at one station. ``If I don’t get gasoline I can’t work.″

The strike ended earlier this week in every other industry. But some restaurants and stores were having trouble opening because of the gasoline scarcity, which in turn was causing delays in deliveries.

The shortages could worsen as the government implements exchange controls to protect its foreign reserves and the bolivar currency, which lost a quarter of its value during the strike. Dollar requests could take as long as 45 days to process under the new rules, which could delay imports. Venezuela depends on imports for 60 percent of raw materials.

The government fixed the bolivar at 1,598 bolivars to the dollar.

Ramirez said crude oil production was 1.9 million barrels a day, while dissident oil monopoly executives put the figure at 1.3 million. It was 3 million before the strike.

``It will take a couple of months to bring refining capacity back up to a normal operating rate,″ said Ed Silliere, vice president of risk management at Energy Merchant LLC in New York. ``Part of the problem is they have fired a lot of the key people that used to run these things. You can’t replace these people that easily.″

Chavez has fired more than 9,000 of the state oil company’s 40,000 employees, vowing to use the strike to restructure, downsize and eliminate dissent within the company. The president vowed Friday not to rescind the firings. ``Not if I were crazy,″ he declared in a speech to diplomats.

Chavez said many fired executives were the same ones who led an oil strike in April that helped prompt a brief coup. Chavez rehired them after regaining power.

The fate of the fired workers is a sticking point in negotiations between the government and opposition sponsored by the Organization of American States.

Opposition leaders refuse to call off the oil strike until the government rehires the fired workers and agrees to an early vote on Chavez’s rule.

Citing months of economic and political turmoil, Venezuela’s opposition _ a combination of leftists, conservatives, labor unions and business groups _ wants to amend the constitution to end Chavez’s six-year term and call general elections this year.

The government insists a referendum must wait until halfway through a president’s term, as provided in the constitution _ in Chavez’s case, August 2003.

Nobel Peace Prize Laureate Jimmy Carter proposed both plans as a solution to Venezuela’s crisis. On Friday, the former president praised both sides for using his proposals ``as a basis for progress,″ and the opposition for scaling back the strike.