20. Fuel Transport by Chavez

By James Ingham 

BBC News, Caracas

Hugo Chavez is fighting rising inflation in Venezuela's economy.

Venezuela's parliament has approved a new law giving the state a majority share in the distribution of fuel.

President Hugo Chavez said the measure was needed to stop intermediary firms from profiting from high oil prices.

They will now have a limited role in transporting fuel to the country's petrol stations.

This is the latest in a series of state takeovers of private companies by Venezuela's socialist government, including major US oil companies.

Venezuela's national energy company will now control almost all elements of the huge oil industry.

Exploration and refining is already handled by the state, with some involvement of private partners.

But until now, the transport of petrol was in the hands of dozens of private firms, including some major multinationals.

President Hugo Chavez said they were making money at the country's expense.

Nationalisation

Many transport operators will be forced to sell their businesses to the government or face expropriation.

Critics have suggested the huge state company won't distribute petrol as efficiently as private firms.

But the government has promised an improved service with regular deliveries to the most remote corners of Venezuela.

It has also said the measure will help stop the illegal smuggling of the country's very cheap fuel across the border to Colombia and Brazil.

The move is part of a wider policy that has seen most key sectors of the economy pass into the state's hands.

It is one of the controversial pledges of President Chavez, who has promised that the government can benefit the nation if it runs more of the country's businesses itself.