Oil prices rise; tanker pilots break strike in Maracaibo

| 1/22/2003

Oil prices are near two-year highs despite OPEC's promised increase in production, analysts say, because of the threat of war with Iraq and political uncertainty in Venezuela.

Oil prices hit $34 a barrel in New York. Analysts say prices are likely to rise to $35 per barrel or higher in the next month if the crises in Venezuela and the Persian Gulf continue.

In the event of U.S. military action against Iraq, prices could jump above the $40 record set during the 1991 Gulf War. If that happens, President Bush is likely to open the Strategic Petroleum Reserve to help tame prices.

Meanwhile, oil tanker pilots have ended a seven-week-old strike in western Lake Maracaibo, a key oil export area, Venezuelan shipping agents said Tuesday in a report by Reuters.  The strike was aimed at forcing President Hugo Chavez to resign.

While an end to the tanker pilots' action in Venezuela can be expected to boost exports, shippers said deliveries were not likely to rise rapidly until foreign ship operators began using ports again.

In total, there are about 24 channel pilots and 20 docking pilots in Maracaibo. Only five or six pilots were available until now. Agents said the end of the pilots' strike meant that up to five tankers could leave the channel on one tide, vs. two tankers now.