By Greg Morsbach
BBC News, Caracas
After months on the road and millions of dollars in air fares, Venezuela's top diplomats are now finally able to take a breather after an intense but deadlocked battle to gain a rotating seat on the UN Security Council.
President Chavez headed the diplomatic offensive at the UN
There is no real sense of celebration in Caracas - more a feeling of satisfaction in Venezuela's foreign ministry after Panama was found as a consensus candidate to overcome the impasse between Guatemala and Venezuela, both of which failed to get enough votes at the UN General Assembly.
President Hugo Chavez of Venezuela had personally taken charge of the diplomatic offensive and doggedly insisted that Venezuela had all the votes it needed to deliver a crushing defeat against Guatemala, and by extension its chief supporter, the United States.
But he could not deliver the decisive knock-out blow at the UN he was promising the world just four weeks ago.
His top aides are now taking stock of what they managed to achieve politically by preventing Guatemala from gaining a Security Council seat.
Some see it as a resounding moral victory for Mr Chavez, arguing that a developing country managed to hold its ground against a global superpower, namely the US.
Mr Chavez will continue his confrontation with the US on all fronts despite this setback at the UN
Analyst, Inter-American Dialogue
Others say it was a goalless draw against Washington and it is now time to fight the next big battles which lie ahead.
The Venezuelan ambassador to the UN, Roy Chaderton-Matos, who was specially appointed to oversee the bid for the Security Council told the BBC:
"We're happy with this outcome at the UN, which marks the start of a worldwide insurgence against the forceful diplomacy of US, which tries to impose its will on sovereign countries."
Panama under pressure
Ambassador Chaderton said he and other Venezuelan officials were confident that Panama - the consensus candidate backed by Caracas and Guatemala to end the deadlock - would "do a good job at the UN due its strong historical links with Venezuela".
Venezuela is in the middle of a presidential election campaign
But some analysts say that Panama will now find itself in a vice between Presidents Bush and Chavez.
"There'll be enormous pressure brought to bear by both sides on Panama to either do the bidding of Caracas or the US," said Michael Shifter, a senior analyst at the Inter-American Dialogue think tank in Washington.
"There's no doubt that Mr Chavez will continue his confrontation with the US on all fronts despite this setback at the UN," Mr Shifter added.
The question is whether the setback for President Chavez will really make much of a difference to his foreign or indeed domestic policy.
On the international stage, Mr Chavez will possibly argue, with some degree of success, that he put his personal ambitions to one side for harmony and the greater good within the UN by deciding to withdraw from the race.
The left-wing Venezuelan leader may also take some comfort from the elections in Nicaragua this Sunday, where his friend and close ally, the former Sandinista leader, Daniel Ortega, is currently leading opinion polls.
Nevertheless, Mr Chavez's departure from the contest is a U-turn after weeks of fighting talk in which he vowed never to give in and never to seek a negotiated settlement.
What does upset many people here is President Chavez's long term plan to forge strategic alliances in the region and the world by giving away Venezuelan petroleum or oil money in return for moral support
"The reality is that Chavez was persuaded to quit the contest by his closest advisers because these seemingly endless rounds of votes were starting to damage his international credibility and his credibility at home," said Milos Alcalay, a former Venezuelan ambassador to the UN.
"His decision to quit now was largely motivated by the Ibero-American summit taking place in Uruguay this week. Chavez didn't want to expose Venezuela there to tough questions and criticism by fellow Mercosur countries over its stubborn behaviour at the UN."
Ambassador Alcalay is sure the opposition here in Venezuela will use President Chavez's failure to win a clear-cut victory in New York as political ammunition against him as he is in the middle of a presidential election campaign.
For the past months the pro-opposition media had been full of stinging commentary, arguing that the government was wasting taxpayers' money by funding expensive overseas trips for Mr Chavez, aimed at gathering more votes for the battle at the UN.
However, respected newspaper commentators like Alberto Garrido argue that foreign policy is pretty much a sideshow in the nationwide election campaign and that more pressing topics such as crime, housing and unemployment are more significant for the electorate.
"The setback at the UN will be forgotten here very soon by voters. I doubt it will register at all with many of them. Of course, the opposition will try to capitalise from it but they won't dwell on it because there's not much to be gained from a narrow debate on the UN bid," Mr Garrido explained.
"What does upset many people here is President Chavez's long term plan to forge strategic alliances in the region and the world by giving away Venezuelan petroleum or oil money in return for moral support."
Housing and unemployment are key to the Venezuelan electorate
What worries Mr Garrido and others though is that the UN episode has helped to forge two anti-Chavez blocks in Latin America.
"You have a front in central America with Mexico at the centre which almost certainly voted against Venezuela and then you have a front in South America where Colombia, Ecuador and Peru failed to come out in support of Mr Chavez at the UN.
"And then you have countries like Chile increasingly gravitating towards the anti-Chavez camp in South America, even though they abstained in one, if not several rounds of voting."
However, there is a consensus among some analysts that as long as the Venezuelan economy continues to grow steadily and as long as the government can carry on funding expensive social benefit programmes for the poor with the help of high oil revenue, Mr Chavez's foreign policy will not be scrutinised too closely at home.
"I think you'll begin to see Mr Chavez's diplomacy being questioned at home a lot more once he runs out of the oil money he needs to fund all these social welfare programmes he has put in place," said Michael Shifter.