Venezuela talks up Chavez's Libya peace plan

CARACAS (Reuters) - Venezuela pushed a vague peace plan for Libya on Thursday, saying President Hugo Chavez's friend Muammar Gaddafi was in favour of foreign mediation.

Though rebels have rejected talks with the Libyan president and some analysts view the Chavez plan as grand-standing by the socialist leader, officials in Caracas said the idea had gained traction in Tripoli.

"Libya accepts the proposal to work for a negotiated end to the conflict accompanied by an international commission," Information Minister Andres Izarra told Reuters.

"Venezuela will continue its contacts in the Arab world and elsewhere to find formulas for peace."

Gaddafi's son Said El-Islam told Sky News he appreciated the offer but said there was no need for help from Venezuela.

The Arab League said it was considering the idea but needed more details. Oil markets gave the plan some credence, with prices falling after a rally on worries the Libya crisis will hit supplies.

Both Chavez and Gaddafi are military men who cast themselves as anti-imperial revolutionaries and have forged a friendship during half a dozen encounters in the last decade.

Much like his mentor, Fidel Castro of Cuba, Chavez often takes a vocal role in international crises, although his efforts to influence events do not always bear fruit.

Venezuela is aiming for a mission from Latin American, European and Arab nations, but has given few concrete details.

Perhaps seeking to increase the plan's credibility, a government source said Venezuela hoped to convince Brazil's former president Luiz Inacio Lula da Silva to lead mediation.

"Everything's at a very preliminary stage, with very delicate and unstable negotiations," the source added.

Brazil backed a unanimous U.N. security council vote to impose sanctions on Libya last week. In 2010, Lula sought to raise Brazil's global profile by showcasing the South American nation as an unbiased mediator in the crisis over Iran's nuclear program, but was rejected by Western nations.

ACCUSATIONS OF INVASION PLAN

Analysts are skeptical Chavez can help bring a quick end to fighting in Libya, where Gaddafi faces an increasingly organized rebel army that said it would only negotiate an end to the leader's 41-year rule.

"Chavez's credibility does not fly very high," said Olivier Jakob of think-tank Petromatrix. "The only value of such a proposal is if it offers some honorable way out for the Gaddafi clan."

Chavez, who has won plaudits in the Arab world for his condemnation of Israel, says Washington exaggerates reports of repression to justify an invasion of Libya for its oil wealth.

"They are imposing a diplomacy aimed at empowering the empire for an invasion against the Libyan people," his Foreign Minister Nicolas Maduro said.

Along with fellow left-wingers Castro and Nicaraguan President Daniel Ortega, Venezuelan officials point to Libya's relatively high levels of education and healthcare to suggest the uprising is over oil not living conditions.

Ecuador, another Chavez ally, said foreign ministers from the left-wing ALBA bloc of Latin American nations would meet in Caracas on Friday to discuss Libya.

Venezuela has been mentioned as a possible destination for Gaddafi if he abandons Libya. He visited the South American fellow OPEC member in 2009, donating a Bedouin tent to Chavez.

A small group demonstrated outside the Libyan embassy in Caracas calling Chavez an apologist for "assassin" Gaddafi.

(Additional reporting by Eyanir Chinea; Editing by Andrew Cawthorne)

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