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To: ChanceIs who wrote (47865)	7/13/1999 12:23:00 PM
From: Tomas	Read Replies (1) \| Respond to of 95453

Mexico warns on 'US threat' to oil markets - Financial Times, Tuesday By Andrea Mandel-Campbell in Mexico City Luis Téllez, the Mexican energy minister, has warned that the US could disrupt world oil markets if it goes ahead with a threatened anti- dumping case against four of its main foreign oil suppliers. The US Department of Commerce has until July 19 to decide whether to investigate dumping charges against Mexico, Venezuela, Saudi Arabia and Iraq by a group of independent US oil producers. According to Mr Téllez, if the US imposes countervailing duties, Mexico and Venezuela would be forced to increase crude oil supply to make up for lost revenues, thereby breaking a hard-won agreement forged earlier this year by the world's oil producers to cut exports. Mr Téllez was one of the architects of the agreement co-ordinating export cutbacks between Mexico, Saudi Arabia and Venezuela and allocating some to other producers, a move that reduced world petroleum exports by 5.1m barrels a day. Partly as a result of the accord, Mexican oil prices rose $5.35 per barrel between February and May. On July 1, independent US producers based in Oklahoma presented a petition to the Commerce Department saying the four countries were selling oil below cost. They are seeking countervailing duties on crude oil imports ranging from 33 per cent for Mexico to 177 per cent for Venezuela. "If the duties are applied it will bring enormous instability to oil markets because we don't know if the agreement will hold," Mr Téllez said. The tariffs would also have a significant impact on the Mexican economy and would strain relations between the US and Mexico, he said. Mexico sells 80 per cent of its heavy crude output to the US and relies on oil proceeds for 30 per cent of its public sector revenue. Mexico has spent at least $2m on lawyers and expert witnesses as part of a co-ordinated defence effort with Venezuela and Saudi Arabia, which are the two principal suppliers of oil to the US. As a reprisal, Mexico suspended a move on July 1 to lower tariffs on natural gas imports from the US. Mexico and Venezuela deny they have sold oil below cost in the US, saying prices are set by international markets. The US International Trade Commission has until mid-August to establish whether the foreign crude imports in 1998 and 1999 caused any material damage to US domestic producers. In a concurrent investigation, the Commerce Department is assessing whether the petitioning US producers represent the necessary 25 per cent of domestic production to go ahead with the case. The group is arguing it supplies a quarter of production on a regional basis, excluding a number of US states. Mr Téllez said several US oil companies with interests in Mexico had begun lobbying the Commerce Department to have the case dismissed.

To: ChanceIs who wrote (47865)	7/13/1999 1:24:00 PM
From: still learning	Read Replies (1) \| Respond to of 95453

So does anyone know which individual companies stand to profit by a positive ruling in the trade dumping case? Would we just see duties on foreign oil, import quotas, or what would the likely remedy be?