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Giuliani law firm has ties to Chavez

Rudolph W. Giuliani's law firm has lobbied for years on behalf of an oil company controlled by the Venezuelan president, Hugo Chavez, a strident critic of President Bush and American-style capitalism.

Bracewell & Giuliani, the Houston-based firm that Giuliani, the former mayor of New York, joined as a name partner two years ago, handles lobbying in the Texas statehouse for Citgo Petroleum Corp. of Houston. Citgo is the American subsidiary of Petroleos de Venezuela, the state-owned oil company that Chavez controls.

Giuliani's duties at his law firm do not include lobbying. But the financial relationship with a company affiliated with one of the most outspoken critics of the United States potentially exposes Giuliani to new scrutiny as he campaigns to become the Republican nominee for president.

Chavez has used his country's oil wealth to lure fellow Latin American leaders away from alliances with the United States. In recent years, he has called Bush a "donkey," a "drunkard" and a "coward," blamed him for a failed 2002 coup attempt in Venezuela, and allied himself with Fidel Castro.

The Giuliani campaign declined to answer questions yesterday about the client but issued a statement after a report about the relationship was posted by Bloomberg News, which said the firm was paid $5,000 a month for the work in 2005 and 2006.

"Mayor Giuliani believes Hugo Chavez is not a friend of the United States and his influence continues to grow because of our increasing reliance on foreign sources of oil," the statement said. "As the mayor has consistently stated -- the development of alternative fuels is a priority that demands a solution in order to ensure the United States energy independence."

The Citgo lobbying contract represents the first time that a client of one of Giuliani's private businesses has become an issue for his campaign. The campaign had previously acknowledged that his clients might be used against him .

Just last week, Giuliani announced an agreement to sell his boutique investment bank to an Australian company, based in part, aides said, on his desire to avoid political problems.