Russia and Venezuela forge ties and poke a finger in US eye

Russia and Venezuela reinforced their relationship yesterday as Hugo Chávez, the president, arrived in Moscow to sign arms and energy deals and establish a binational bank. 'I have great hopes we will be able to continue building our strategic alliance,' Mr Chávez said after landing in Moscow, emphasising co-operation on oil and gas and military technology. 'The deals will guarantee the sovereignty of Venezuela, which is being threatened by the United States.' Deals were signed allowing three large Russian energy companies to work in Venezuela's oil-rich Orinoco Belt. Lukoil and TNK-BP will be allowed to explore for oil, while a subsidiary of Gazprom is to assess gas reserves. Venezuela is also interested in setting up a joint bank to facilitate bilateral trade, which exceeded $1bn (£500m) in 2007, more than double the 2006 total. Venezuela already has contracts for Russian military equipment worth about $4bn, but Russian media have reported that Mr Chávez wants to sign further deals for up to $2bn, possibly to buy more tanks, helicopters, air defence systems and submarines.