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Page last updated at 01:19 GMT, Saturday, 9 May 2009 02:19 UK

Chavez seizes oil service firms

Venezuelan President Hugo Chavez, right, shakes hand with an oil worker in Lagunillas, Lake Maracaibo, on 8 May 2009.
Mr Chavez is tightening his grip on the oil industry

Venezuelan President Hugo Chavez has sent troops to take over companies that provide services for the oil industry.

"This is a revolutionary offensive," he told workers near Lake Maracaibo, Venezuela's main oil-producing area.

Military vehicles were used as the state oil company seized supply boats and two US-owned gas facilities.

Mr Chavez nationalised Venezuela's main oil assets two years ago. The fresh drive comes as falling oil prices put state finances under pressure.

The move places hundreds of boats, several ports and an estimated 8,000 oil workers under state control.

The state-owned oil company PDVSA has recently clashed with foreign and local service providers over the prices they charge.

The service companies are owed billions of dollars by PDVSA. But the state firm says lower oil prices mean the contractors are being paid too much.

President Chavez has re-invigorated his nationalisation programme since his victory in a February referendum that removed limits on how many times he and others can stand for re-election.

Venezuela has some of the biggest oil reserves in the world and is one of the largest oil exporters in the Americas.



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