Officials said the meeting on Thursday marked the highest-level personal contact that Ambassador William Brownfield has made with the Venezuelan government since he took over as the top US diplomat in Caracas more than six months ago.

The talks, held in the office of Foreign Minister Ali Rodriguez, came after weeks of increasingly sharp accusations between officials in Washington and President Hugo Chavez, who has warned he will cut off oil to the United States if it were to back an attempt to oust him.

"We had a cordial exchange about issues of mutual interest," Rodriguez said in a statement.

"We agreed there are sensitive aspects that must be worked on, little by little, to achieve the best relations possible," he said, adding the two countries could move forward in areas of complete agreement, such as oil-related issues and efforts against drug-trafficking and terrorism.

First meeting

The US embassy said the meeting was Brownfield's first with the foreign minister and that Rodriguez had invited him, but it did not release further details.

The Bush administration views Chavez with suspicion

Rodriguez said the two established "mechanisms of communication and consultation with a view to working toward the best possible relations". 

US officials in Washington have expressed concern about the health of democracy under Chavez, freedom of the press, Chavez's stance towards leftist Colombian rebels and his moves to buy helicopters and 100,000 Kalashnikov rifles from Russia.

Chavez, a close ally of Cuban leader Fidel Castro who says his revolution for the poor is "anti-imperialist", has accused US officials of making false claims to destabilise his government. He has insisted he is committed to democracy and poses no threat to the region.

This week, his government said Chavez's presidential security was being tightened due to an unspecified assassination plot.

Chavez has said he will hold US President George Bush personally responsible if there is any such attempt.

The meeting came as Chavez appeared to soften the tone of his recent remarks, insisting he hopes to improve relations with Washington and continue selling oil to Venezuela's top client.

At the same time, Chavez has been signing oil deals recently with new clients from China to India.

Venezuela is the world's fifth largest oil exporter and supplies about 13% of US crude oil imports.