RIYADH, Saudi Arabia -- A blunder by OPEC on Friday exposed a disagreement between Saudi Arabia and Iran about the falling dollar when a private meeting of ministers was broadcast to journalists by mistake.
In an embarrassing oversight, the private meeting of foreign, finance and oil ministers from the 12 members of the Organisation of Petroleum Exporting Countries was broadcast for 30 minutes on closed-circuit television in the media room.
Iran's Foreign Minister Manouchehr Mottaki said in a written proposal that a final declaration by OPEC leaders, who arrive here Saturday for a two-day summit, should express concern by member states over the fall of the US dollar.
Reacting to the request, Saudi Foreign Minister Prince Saud al-Faisal Saudi Arabia's foreign minister warned that mentioning the falling dollar could lead to the "collapse" of the US currency.
"There are media people outside waiting to catch this point and they will add to it (exaggerate) and we may find that the dollar collapses," he said.
Member states should express concern over "the continued depreciation of the US dollar" in the final declaration, Mottaki said.
US foe Iran was joined in its attempt to put the falling dollar on the agenda by another of Washington's antagonisers, Venezuela.
Prince Saud, who was chairing the meeting, described the Iranian proposal as "sensitive."
"This is a sensitive issue. It will cause the dollar to drop further, thus complicating the problems we are facing from the dollar's fall," Prince Saud said.
The fall of the US dollar, which has declined by about 15 percent in 12 months, has affected the revenues of OPEC members because most of them price and sell their oil exports in the US currency.
The remarkable insight into the inner workings of the Organisation of Petroleum Exporting Countries, which produces 40 percent of world oil, ended when an official emerged to switch off the television.
Ironically, Iran has moved away from the dollar and now prices nearly all of its exports in local currency, meaning most of its revenues are in euros and yen, a source in the Iranian delegation told AFP earlier.
He said that this had saved the country about 10 billion dollars (14 billion euros) this year.
He also said that OPEC was unlikely to make a statement on the dollar because the organisation believed the issue of pricing oil was a sovereign issue that should be dealt with individually by members.
The summit, which begins on Saturday, is only the third gathering of OPEC head of states in the organisation's 47-year history.
The 12-member organisation, dominated by US ally Saudi Arabia, produces about 40 percent of world oil and attempts to regulate production of its members through a quota system.
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TEHRAN, Iran -- The presidents of Venezuela and Iran boasted Monday that they will defeat U.S. imperialism together, saying the fall of the dollar is a prelude to the end of Washington's global dominance.
Hugo Chavez's visit to Mahmoud Ahmadinejad in Tehran followed a failed weekend attempt by the firebrand duo to push the Organization of Petroleum Exporting States away from trading in the slumping greenback.
Their proposal at an OPEC summit was overruled by other cartel members led by Saudi Arabia, a strong U.S. ally. But the cartel agreed to have OPEC finance ministers discuss the idea, and the two allies' move showed their potential for stirring up problems for the U.S.
The alliance between Chavez and Ahmadinejad has blossomed with several exchanged visits -- Monday's was Chavez's fourth time in Tehran in two years -- a string of technical agreements and a torrent of rhetoric presenting their two countries as an example of how smaller nations can stand up to the superpower.
"Here are two brother countries, united like a single fist," Chavez said upon his arrival in Tehran, according to Venezuela's state-run Bolivarian News Agency.
"God willing, with the fall of the dollar, the deviant U.S. imperialism will fall as soon as possible, too," Chavez said after a two-hour closed meeting with Ahmadinejad, the Iranian state news agency IRNA reported.
As the dollar weakens, oil prices have soared toward $100 a barrel. Chavez said over the weekend at the OPEC meeting in Riyadh, Saudi Arabia, that prices would more than double to $200 if the U.S. attacked Iran or Venezuela.
"The U.S. empire is coming down," Chavez told Venezuelan TV, calling the European Union's euro a better option and saying Latin American nations were also considering a common currency.
The leftist Venezuelan is a fierce critic of President Bush, and Iran's Islamic government is in a bitter standoff with Washington over Tehran's nuclear program. The U.S. accuses Iran of seeking to develop nuclear weapons, a claim Tehran denies, and Iran has been hit with two rounds of U.N. sanctions for refusing to suspend uranium enrichment.
Ahmadinejad backed his "dear brother" Chavez in their joint fight with the Bush administration.
"We have common viewpoints and we will stand by each other until we capture the high peaks. God is with us and victory is awaiting us," Ahmadinejad was quoted as saying by IRNA. He said he and Chavez would stick together to defend their "nations and ideals to the end."
During the OPEC meeting, Iran and Venezuela proposed that the cartel begins pricing its oil in a basket of currencies, rather than just the dollar, and wanted the summit to specifically express concern over the dollar's slide in its final statement.
Saudi Arabia blocked those moves. Saudi Arabia's foreign minister cautioned that even talking publicly about the currency's decline could further hurt its value.
Chavez repeated his warnings that attacking Iran would further increase oil prices. "It's very important that they leave us in peace, the major oil-producing countries," he said.
"If it occurs to Bush to invade Iran, I'm sure the Iranians will resist, and they aren't going to allow them to take away their oil, just as we Venezuelans wouldn't allow it," he said.
In Tehran, the two presidents signed four memorandums of understanding Monday to create a joint bank, a fund, an oil industry technical training program, and an industrial agreement, Iranian state television said. It said Chavez then left after an official farewell ceremony.
On Chavez's previous visit in July, the two leaders broke ground for construction of a jointly owned petrochemical complex in Iran, with 51 percent of it in Iranian ownership and 49 percent to be owned by Venezuela. The two nations also began construction of a second petrochemical complex in Venezuela, at a total combined cost of $1.4 billion.
Chavez and Ahmadinejad believe their petrochemical partnership will help Iran win markets in Latin America and Venezuela to gain access to Asia's energy market, especially India.
Since 2001, the two countries have signed more than 180 trade agreements, worth more than $20 billion in potential investment, according to official reports.
Iran has partnered with Venezuela on several industrial projects in the South American nation, including the production of cars, tractors and plastic goods.
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'Shut Up' Is Hit Ringtone in Spain
By Mar Roman Associated Press via Yahoo News Monday, November 19, 2007
MADRID, Spain -- Many Spaniards were so amused when their king told Venezuela's president to "shut up" they want to hear the words every time their phone rings.
About half a million people have downloaded a mobile phone ringtone featuring the phrase "Por que no te callas?" or "Why don't you shut up?" leading Madrid daily El Pais reported on its Web site Monday.
That's what King Juan Carlos told Venezuelan President Hugo Chavez during a heated confrontation at a summit in Chile last week.
The ringtone is thought to have generated around $2.2 million for the companies selling it, El Pais said.
T-shirts and mugs featuring the words are also becoming a profitable business, and videos of the confrontation have been a hit on the YouTube Web site.
Chavez's opponents in Venezuela are no less obsessed.
Pirated copies of the quote have been popping up in the South American country.
In Venezuela, T-shirts with the slogan in Spanish have the "NO" in uppercase -- a call for voting against constitutional reforms that would significantly expand Chavez's power. The Venezuelan leader says the changes would empower neighborhood-based assemblies and advance the country's transition to socialism.
"The king said what Venezuelans have wanted to say to Chavez's face for a long time," said Jenny Romero, 21, a student sporting one of the T-shirts in Caracas. "I'm wearing this T-shirt to protest everything bad that has happened in the country."
The spat last week began when Chavez repeatedly called former Spanish Prime Minister Jose Maria Aznar a "fascist."
Spain's current prime minister, Jose Luis Rodriguez Zapatero, asked Chavez to be more diplomatic and show respect for other leaders. As Chavez repeatedly tried to interrupt, King Juan Carlos leaned forward and said: "Why don't you shut up?"
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China on Monday expressed concern at the decline in the dollar, joining a growing chorus of global policymakers alarmed by the weakness in the world's main reserve currency.
Wen Jiabao, the premier, told a business audience in Singapore it was becoming difficult to manage China's $1,430 billion foreign exchange reserves, saying their value was under unprecedented pressure. "We have never been experiencing such big pressure," Mr Wen said, according to Reuters. "We are worried about how to preserve the value of our reserves."
China keeps the currency composition of its reserves a state secret, but some analysts believe that more than two-thirds are probably still held in dollars.
The dollar has dropped 16 per cent this year against a basket of major currencies.
Mr Wen's comments came as top international economic officials spoke out in support of a strong dollar in the aftermath of the weekend's Group of 20 summit in South Africa and Opec meeting in Riyadh.
Hank Paulson, US Treasury secretary, told reporters in Ghana: "A strong dollar is in our nation's interest." He said the US economy had had its "ups and downs" but he believed "our long-term economic strength will be reflected in currency markets." Mr Paulson and other top US officials, including George W. Bush, the president, have become increasingly vocal on the dollar, signalling that they are not indifferent to its fate.
Zhou Xiaochuan, China's central bank chief, said Beijing wanted a strong dollar because it would help to ensure an orderly resolution of the recent market instability caused by US mortgage lending problems.
"So in this sense, actually we hope to see a strong dollar," Reuters quoted Mr Zhou as saying. "We support a strong dollar.'
Jean-Claude Trichet, president of the European Central Bank, said Mr Zhou’s remarks "echoed what has been said by the monetary authorities of the US."
Stephen Jen, head of currency research at Morgan Stanley, said: "What we are witnessing is uncoordinated verbal intervention.
"This is useful, as in the absence of it, investors and speculators would have interpreted it as the authorities condoning what was going on in the currency markets."
The Japanese yen rallied against a range of currencies on Monday, notably commodity-based rivals such as the Canadian and Australian dollars. The prospect of China allowing its currency to appreciate against the dollar drove sentiment, traders said.
The dollar was little changed at $1.4655 against the euro and edged 0.1 per cent higher to $2.0504 against the pound. The US currency has shown some tentative signs of stabilisation in the past few days, but many analysts remain bearish.
Russell Jones, head of currency strategy at RBC, said: "Any respite in the dollar's weakness is likely to be temporary. The dollar isn't a safe haven at the moment, because most of the problems facing the world economy are coming out of the US."
Ashraf Laidi, currency strategist at CMC Markets, said, "The power in influencing the fate of the dollar lies increasingly with the oil producers as they struggle with a falling dollar."
Mr Wen's remarks are likely to fuel market speculation that Beijing might move to reduce the proportion of its reserves held in the US currency.
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