Aug. 13 (Bloomberg) -- Venezuelan President Hugo Chavez gained support in opinion polls ahead of a weekend recall vote, prompting some investors to bet he will survive the referendum as he did a military coup in 2002 and an oil strike last year.

``We don't think the opposition will get enough votes to oust him,'' said Nicholas Field, who holds Venezuelan bonds among the $750 million of emerging market-debt he manages at WestLB Asset Management in London.

A victory for Chavez would boost confidence in Venezuela, the world's fifth-largest supplier of oil and a member of OPEC, because he has shown a commitment to paying interest on the nation's $22 billion foreign debt, said Field. Venezuela's benchmark bond due 2027 rose to a six-month high, climbing 0.65 cent to 91.95 cents on the dollar, according to J.P. Morgan Chase & Co. at 9:50 a.m. in New York. The bond was at 76 cents in May.

Opinion polls by Consultores 21 and Greenberg Quinlan Rosner Research Inc. taken in July showed Chavez, a 50-year-old former lieutenant colonel who counts Cuban President Fidel Castro among his friends, improving his standing. Since the referendum was announced in June, Chavez has narrowed the gap with the opposition, making the election too close to call, said analysts at J.P. Morgan Chase & Co. and HSBC Holdings Plc.

Washington-based Greenberg's poll published last month showed 50 percent of ``likely'' voters would vote to recall Chavez compared with 62 percent in March.

Some polls surveying Venezuela's 14 million voters, including one published July 27 by Evans/McDonough Co. and Caracas-based Varianzas Opinion and commissioned by the state oil company, show Chavez winning Sunday's vote.

`Inevitable'

``Our victory is simply inevitable,'' Chavez said during a press conference in Caracas yesterday. ``Nothing can stop it.''

The opposition led by Enrique Mendoza, governor of Miranda, and Julio Borges of the First Justice Party, collected 2.44 million signatures to force the recall vote 2-1/2 years before the end of Chavez's term. Mendoza said today in a speech in Caracas that Chavez has failed to combat crime and create jobs.

Unemployment climbed to as high as 20.7 percent in March 2003 compared with 11 percent in 1998, the year before Chavez took office, and was at about 16 percent in March this year, government figures show. Caracas had the third-highest murder rate of any city in the Americas between 1999 and 2003, according to the Inter-American Development Bank.

Opposition

``We're going to kick Hugo Chavez out of power to reconcile all Venezuelans and have a country for all,'' said Oscar Perez, a spokesman for the Democratic Coordinator, at the start of a protest march yesterday in Caracas. The group represents 44 organizations, including the nation's largest labor union, Confederation of Venezuelan Workers, and biggest business association, Federation of Venezuelan Chambers of Commerce, as well as more than a dozen political parties.

Chavez, who sends oil to Cuba at subsidized prices in exchange for medical assistance, said in his weekly televised speech on Sunday that the vote is an attempt by the U.S. -- which purchases 60 percent of Venezuela's oil exports -- to replace him with a pro-American government.

Jose Castillo, a 40-year-old cement factory worker who is learning to read and write through a government literacy program, says he will support Chavez on Sunday.

``I'm sure we'll win because there are more poor people than rich people,'' said Castillo, who lives in one of the slums that pepper the hillsides of Caracas and which are festooned with banners and posters urging voters to reject a recall.

U.S. Warning

The U.S. State Department warned in a statement Wednesday night that the vote could result in violence on Sunday. Concern that referendum could disrupt the oil supply contributed to driving world oil prices up to a record high. Ten people died in February in March in opposition protests.

Felix Rodriguez, vice president of Venezuela's state oil company Petroleos de Venezuela SA, said Aug. 9 the company ordered extra security at its installations to guard against possible violence that a close victory or loss for Chavez may trigger.

``There may be unrest if it's perceived that he stole the vote but my guess is things will be calm,'' said Jim Barrineau, a senior vice president for emerging markets at Alliance Capital Management Co. in New York, which manages $145 billion in fixed- income securities. He declined to say how much he holds in Venezuelan or Latin American bonds.

Carter Center

Observers from the Organization of American States and the Carter Center, an organization run by former U.S. President Jimmy Carter to help strengthen democracies, will monitor Sunday's vote for fraud.

The result of the computerized ballot will be known less than three hours after voting ends at 6 p.m. in Caracas (6 p.m. New York time), according to the National Electoral Council.

For Chavez to be recalled, the opposition must gain a majority in the ballot and win more votes than the 3.76 million votes Chavez garnered when he was reelected in 2000. A Chavez defeat would lead to a new election next month, with the winner serving as president until January 2007. Chavez has promised to run if he loses this weekend's vote.

The Democratic Coordinator said it would hold primaries among 20 opposition parties to pick a presidential candidate if Chavez is recalled.

No `Credible Candidate'

``If there's a clear cut win by the opposition Chavez will run again and likely win,'' said Raphael Kassin, who helps manage about $1.4 billion of bonds, including Venezuelan debt, at ABN Amro Asset Management in London. ``The opposition has no credible candidate or alternative to Chavez. There's no clear-cut candidate that's charismatic enough to change things in Venezuela.''

Rising oil prices enabled the government to double spending from January to the end of May to 16.5 trillion bolivars ($8.6 billion) from the same period in 2003, when oil output was reduced by the effects of a two-month strike by trades unions, businessmen and petroleum workers.

The oil price also helped the $90 billion economy expand 30 percent in the first quarter of this year after contracting 9 percent in both 2002 and 2003. Venezuela's foreign currency reserves, which Chavez has protected by restricting access to dollars, now stand at about $21 billion.

Oil, which accounts for about 80 percent of Venezuela's exports, is more important for the economy than who runs the government, said Philippe Crettex, the country manager of New York-based Pfizer Inc. the world's largest drug company.

``Short-term, it doesn't matter who wins the referendum, the economy is still dependent on oil,'' Crettex, 50, said in an interview at his office in Caracas.

To contact the reporter on this story: Alex Kennedy in Caracas Akennedy1@bloomberg.net

Last Updated: August 13, 2004 10:10 EDT