Lula Mobbed in Rio, Defends Govt. on Petrobras

Former Brazilian president Luiz Inacio Lula da Silva on Monday rallied behind successor Dilma Rousseff as she battles to stay in power at next month's election amid a corruption scandal and a weak economy.

Lula was mobbed at a rally in central Rio as he made a vociferous defense of Rousseff, who is running neck and neck with environmentalist opponent Marina Silva ahead of October 5 polls.

The 68-year-old said a victory for Rousseff was the only way forward for South America's largest economy, which has slipped into recession according to latest figures.

"Brazilians now have to decide if the path we have been traveling down since 2003 is positive and should be stuck to and improved -- or if we should return to the Brazil of old -- the one of unemployment, giving away (resources), poverty and humiliation," said Lula to wild cheers. 

Silva placed third in the 2010 election after taking 20 percent of votes standing on the Green Party ticket.

Now standing for the Socialist Party after running mate Eduardo Campos died in a plane crash last month, Silva has tried to make capital out of a corruption scandal surrounding Petrobras, Brazil's state oil giant, and around 50 politicians alleged to have taken billions in bribes.

Most of the accused are from Rousseff's ruling Workers Party (PT). Rousseff has denied any knowledge of the sweeteners scheme.

Rousseff backers used Monday's rally to accuse rivals of aiming to privatize Petrobras, set to reap a potential bounty of hundreds of billions of dollars over 35 years from huge offshore oil deposits lying below a thick layer of salt beneath the South Atlantic.

Congress last year voted to earmark all 'pre-salt' royalties from the newly-discovered oil fields for education and healthcare. Lula's government passed a law ensuring all pre-salt operations had a minimum of 60 percent Brazilian involvement.