Brazilian senator José Sarney, the president of the Senate and a key ally of the President of Brazil, Luiz Inácio Lula da Silva, may be forced to resign amid allegations he used his position to win government jobs and contracts for relatives. Senators from parties backing Lula joined by members from the opposition are increasing pressure on Sarney to step down.

But the resignation of Sarney could turn into a double challenge for Lula. The congressional coalition could fall into disarray when the agenda, tightly managed by Sarney includes rewriting crucial oil laws to develop the sub-salt deposits, and stalling an opposition led corruption claim against the government managed oil and gas corporation Petrobras.

The other big challenge is ensuring the PMDB party support for Lula da Silva's chosen successor in next year's presidential election. Mr. Sarney is chairman of the PMDB.

"I don't see how he can continue," said Cristovam Buarque, a senator from the government-allied Democratic Labour Party. "Sarney may leave no later than this week. His situation is unsustainable."

Sarney presided on Monday over the reopening of the Senate following two weeks of recess. He has "no plans to resign" said Senator Renan Calheiros who is the leader of Sarney's party in the upper house. Sarney is "very solid" in his position, Calheiros told reporters.

"Sarney managed to stay in office until now, but I don't think he'll last," according to Senator Jarbas Vasconcellos from PMDB.

Roseana Sarney, the Senate chief's daughter and governor of the Northeastern state of Maranhão, told Lula that her father would resign this week, according to a government official and two PMDB members.

But speaking to reporters on Monday, Sarney said he's "confident" about his situation.

A former president of Brazil (1985/1990), Sarney faces corruption allegations that include embezzling state funds destined for cultural projects and arranging government jobs for relatives and friends.

For months, Lula da Silva has defended Sarney to avoid jeopardizing his coalition, but appeared to distance himself from Sarney last week.

Criticism of Sarney has swirled in newspaper editorial pages and television commentary for months but gained strength in late July after the leak of telephone conversations of Sarney arranging employment for a granddaughter's boyfriend.

Mercopress