Chavez leads Venezuela vote, opposition makes gains

CARACAS Mon Nov 24, 2008 12:13am EST

CARACAS Nov 24 (Reuters) - Venezuelan President Hugo Chavez's left-wing party won most state races in elections on Sunday, shoring up his dominance in much of the OPEC nation, but the opposition scored victories in important power centers.

Chavez's Socialist Party won in 17 of 20 states with another two races too close to call, the national electoral authority said early on Monday.

The multi-party opposition held onto the two states it won at the last regional elections four years ago and wrested from the government control of the state metropolitan area around Caracas as well as the mayoralty of the capital.

The results in tight races in Venezuela's remaining two states were due to be announced later on Monday.

Sunday's results could make more challenging Chavez's goal of pushing through legal reforms that would allow him to run for reelection, especially after Venezuelans narrowly rejected the move last year in a referendum.

The anti-U.S. leader's party immediately declared victory, although there was not the usual explosion of celebrations around Caracas that have followed other election wins.

The opposition can point to its gains too, and will seek to use its momentum in the capital to stifle the president's ambitions to run for reelection in 2012.

The opposition fended off an aggressive Chavez campaign and retained control of the oil-producing state of Zulia, the country's most populous.

Combined with victories in the capital against veteran Chavez aides, the opposition now holds sway over major urban areas that will be pivotal in future elections. It also held on to the Caribbean tourist island state of Nueva Esparta.

Chavez, who calls former Cuban President Fidel Castro his mentor, cast Sunday's vote as crucial to his political future.

Popular for spending oil wealth on the majority poor, Chavez frenetically campaigned at rallies of redshirted supporters across a nation that he has allied with Iran and Russia despite being a top oil supplier to the United States.

Chavez also faces tough economic times ahead.

Venezuela's government relies on oil for more than 50 percent of its income and the value of crude has plummeted about $100 per barrel since July. (Editing by Kieran Murray)

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