Chavez troubles sees oil price fall

Rumours that the opposition in Venezuela is looking to oust President Hugo Chavez again has seen oil prices fall. Venezuela under President Chavez has championed strict adherence to oil output quotas set by OPEC. Many analysts believe a change in Government in Venezuela will see that country try to increase output.

In New York trading, a barrel of oil could be bought for $US27.95, down US20c while in London, crude was trading at $US26.38 bbl, down US18c.

Last month, Venezuelan output was 2 per cent below quota. This is in stark contrast to when Mr Chavez assumed office in late 1998, when Venezuelan exceeded its output by 4% and the price of oil was about $US10 bbl.

Venezuela has the largest proven oil reserves outside of the Middle East, supplies about one-sixth of US crude oil imports and is OPEC's third largest producer.

Last month, an eight-day strike at Petroleos de Venezuela SA triggered a nationwide walkout and violent street protests that led to the failed military coup on April 11.