Venezuelan debt has rallied significantly this year, at one stage trading through that of much more highly rated Argentina, as oil prices have surged from $9.55 a barrel in December to $19.10, yet for others such as Russia and Nigeria, the halo effect is not so pronounced, analysts said.

Venezuela's benchmark Bradys, DCBs, have risen from 55-7/8 at the start of the year to 75-1/2 on Friday.

``Venezuela is very sensitive, almost all of the bond gains this year can be put down to the oil price, with very little help from domestic economics or politics,'' said head emerging markets economist, Charles Blitzer, at Donaldson, Lufkin & Jenrette.

Venezuela is the world's third largest oil exporter, and oil usually accounts for more than 60 per cent of government revenue; at $9 barrel this was just 40 per cent. Yet ambitious state spending plans havetaken the shine off higher oil prices that in better years would have plugged the yawning fiscal deficit.

``Investors have been dazzled perhaps by the rising oil price. But even with the international oil price at $20 per barrel for the rest of this year, Venezuela will run a fiscal deficit of about 5 per cent of gross domestic product,'' said one US-based analyst.

For Russia, oil's rise has been overshadowed by the prospect of default and tough negotiations with the International Monetary Fund, and there are questions as well over how much the rise in prices translates into increased government revenues.

Oil accounted for just over 40 per cent of Russia's exports in 1997, worth some $31.3 billion. Russia is currently exporting 3.94 million barrels of oil per day and ``back of the envelope'' maths suggests a $10 rise in oil prices should generate $40 million a day in extra revenues.

But analysts say it is extremely unlikely that simple calculation represents the direct economic benefit toRussia.

``The interesting thing is how much of that extra money finds its way back into Russia, or indeed if any of it beyond the taxes dose,'' said DLJ's Blitzer

Russia's eurobond due 2005 has risen from 23 per cent of face value at the end of last year to 48-7/8 per cent.

One area which is extremely sensitive is equities, where oil shares account for 37 per cent of the Moscow Times share index.

``It (oil) may be priced into equities, but more of what you are seeing is a lowering of the general equity risk premium of the country,'' said European emerging markets equity strategist, Scott Schwager, at Deutsche Bank.In Nigeria, there appears to be no correlation between oil prices and the price of debt instruments.

At the start of the year, Nigeria was looking at a 54 per cent fall in income from 1998.

Yet analysts now estimate that Nigeria's treasury could be getting an $300 million a month more than expected.

Yet none of this has helped Nigerian debt prices and its PAR bonds were trading at 65per cent of face value in February, went as high as 67-1/4 in April, and are now back down at 60.

Nigerian Bradys, which are regularly serviced, are among the most volatile in the emerging markets universe, trading at spreads of 1,100- 1,700 basis points over US Treasuries.

Even after the rise in oil prices, the country is still running a big deficit, equivalent to half the full target, said emerging markets economist Gregory Kronsten at Westdeutsche Landesbank.

Despite Nigeria's massive oil output, very little has fed through into the real economy.

``The oil sector has generally led to a decline in the living standards of Nigeria,'' he said.