Chavez To Seize Some Oil Contractors Under New Law

While Ramirez denied that oil drillers will fall under the law, Patrick Esteruelas, an analyst with the Eurasia Group in New York, said the law's vague wording means these and other service companies could also be affected.

At least two U.S. oil drillers have halted operations in Venezuela over delayed payments, including Helmerich & Payne, based in Tulsa, Oklahoma. The company has halted seven of its 11 oil rigs in Venezuela this year, saying PDVSA owes it $116 million.

Venezuelan oil service companies are also "very afraid," said Nestor Borjas, who heads the business chamber Fedecamaras in western Zulia state. PDVSA is behind an average eight months on payments to 220 companies in oil-rich Zulia responsible for everything from oil well maintenance to providing transport, he said.

Under Chavez, Venezuela has already nationalized foreign-owned steel and cement companies, as well as four major oil projects.

But Esteruelas said PDVSA seems to be aiming more to pressure companies into accepting its terms rather than planning for widespread nationalizations.

"I don't think that PDVSA wants to immediately take over the entire service sector," he said. "That would be a logistical nightmare."