U.S. may extend sanctions on Belarus firms: ambassador

MINSK (Reuters) - The United States may extend sanctions against state companies in ex-Soviet Belarus next year to reinforce its denunciation of what it calls infringements of basic rights, the U.S. ambassador said on Thursday.

Last month Washington barred Americans from doing business with oil producer Belneftekhim, and, like the European Union, it has denied entry to President Alexander Lukashenko and dozens of officials on the grounds he rigged his re-election last year.

"As we have observed no progress from Belarussian authorities, the United States is ready to undertake further moves against state enterprises...," ambassador Karen Stewart told a news conference.

"This will concern state enterprises controlled by people who are responsible for infringements of democracy in Belarus."

Washington says Belarus holds political prisoners and denies civic rights.

Stewart gave no time frame for further punitive measures and did not identify companies which might be targeted. But she suggested the measures could be directed against companies controlled by Belneftekhim.

Belneftekhim controls two oil refineries in Belarus, the Belaruskaliy potash plant and a number of chemical plants which bring in much of the country's foreign exchange earnings.

Belarussian exports to the United States totaled $255 million in the first eight months of the year, with 90 percent of that figure attributable to chemical and oil products.

Stewart discounted any idea of applying sanctions against a joint venture being launched with Venezuela intended to extract 900,000 metric tons of oil annually. Belarussian authorities control 40 percent of the venture that intends to sell the Venezuelan-produced oil on the U.S. market.

Belarus has a long-standing plan to form a post-Soviet merged state with Russia, but Lukashenko quarreled with the Kremlin this year over steep price increases for imports of Russian energy and called for better ties with the EU.

The 27-nation EU has made warmer relations contingent on improvements in Belarus's human rights record including a free press, freedom of assembly and the freeing of what it says are political prisoners.

"The United States, like the European Union, continues to hope that Belarussian authorities will free political prisoners," Stewart said.

(Writing by Ron Popeski; editing by Robert Woodward)