Colombian rebels say hostage swap hopes damaged

BOGOTA (Reuters) - The killing of a Colombian rebel commander in Ecuador over the weekend gravely damaged chances for a hostage exchange between Colombia's government and the guerrillas, the insurgents said on Tuesday.

The death of Raul Reyes, No. 2 leader of the Revolutionary Armed Forces of Colombia, or FARC, set off a diplomatic crisis in which Ecuador has demanded that Colombia apologize for entering its territory and promise to respect its sovereignty.

The guerrilla group said Reyes had been trying, through Venezuelan President Hugo Chavez, to set up a meeting with French President Nicolas Sarkozy aimed at freeing French-Colombian hostage Ingrid Betancourt.

"The death of commander Raul not only dangerously raised tensions between the government and its sister republics, it gravely damaged possibilities for a hostage exchange," the FARC said in a statement.

"The commander fell while trying to organize, through President Chavez, a meeting with President Sarkozy, where they were to advance toward finding solutions for Ingrid Betancourt and reaching a hostage exchange," the statement said.

Both Ecuador and Venezuela have sent troops to their borders with Colombia and recalled their ambassadors as the diplomatic crisis heated up.

The FARC is holding hundreds of kidnap victims for ransom and political leverage, including Betancourt, who was snatched in 2002 while campaigning for president, and three American contract workers kidnapped five years ago.

(Reporting by Hugh Bronstein; Editing by Eric Walsh)