U.S. backs Exxon in Venezuela assets battle

WASHINGTON (Reuters) - The United States backed Exxon Mobil Corp's effort on Wednesday to win compensation from Venezuela for seized assets in a case that has prompted the OPEC nation to threaten to cut off oil supplies to America.

Venezuela's President Hugo Chavez, a foe of the United States, says Exxon court victories that resulted in $12 billion in Venezuelan assets being frozen over the seizure is part of an "economic war" to unseat him directed by the Bush administration.

Despite its support for Exxon, the United States denies it is working to oust Chavez and has distanced itself from the specific legal case.

"We fully support the efforts of Exxon Mobil to get a just and fair compensation package for their assets according to the standards of international law," said State Department spokesman Sean McCormack.

"But we are not involved in that dispute. It is something that has to be litigated between Venezuela and Exxon Mobil and various courts around the world," he added.

Chavez stopped oil exports to Exxon on Tuesday, escalating Venezuela's multibillion-dollar fight with the U.S. company over his nationalization of a project last year that was part-owned by Exxon and Britain's BP.

Britain, where a court issued a temporary ruling in favor of Exxon over Chavez's seizure, also sought to distance itself from the case to avoid harming ties with the OPEC nation.

"The judiciary is independent. It's important to avoid that this adversely affects the good ties we have with Venezuela," British Ambassador Catherine Royle told reporters after dozens of Venezuelans protested the court ruling outside the embassy in Caracas.

Exxon and fellow American oil company ConocoPhillips quit Venezuela over a wave of nationalizations last year. BP was one of several European companies that struck deals to remain in the seized projects as minority partners.

(Reporting by Sue Pleming; additional reporting by Saul Hudson in Caracas, Editing by Sandra Maler and Cynthia Osterman)