Belarus said it is responding to sanctions imposed by Washington on the state-controlled oil and chemical company Belneftekhim.
'Forced' To Act
Anatol Krasutski, the deputy chairman of the Foreign Relations Committee in Belarus's House of Representatives, told RFE/RL from Minsk that the Lukashenka government had no alternative but to act.
"[Stewart] is in Minsk and she'll remain in Minsk while we continue to review the situation."
"This step was forced upon us, and it may lead to a search for some sort of a compromise," he said. "But, I repeat, the American side forced us to take this step."
In Washington, a White House spokesman said the development serves only to further isolate Belarus. U.S. State Department spokesman Tom Casey said President George W. Bush is "deeply disappointed" at Belarus's decision.
Not Leaving Now
But Casey stressed that U.S. Ambassador Karen Stewart hasn't left Belarus and will stay there for the foreseeable future.
"[Stewart] is in Minsk and she'll remain in Minsk while we continue to review the situation," he said. It's important, we think, to have our embassy there in Minsk and to have high-level diplomatic representation there to engage with the Belarusian government on a number of concerns."
In announcing its demand, the Foreign Ministry in Minsk pointed to the Belneftekhim sanctions imposed last autumn. Washington froze that company's assets and forbade U.S. companies to do any further business with it.
Along with the European Union, the United States also has imposed economic and travel sanctions against Belarus until Lukashenka agrees to release political prisoners and allow and institute more democratic reforms. The travel restrictions include Lukashenka himself and his close associates.
Minsk acted on the same day the European Commission agreed to open an office in Belarus. Belarusian political analyst Andrey Fyodarau said the two actions may be linked.
'Good Cop/Bad Cop'?
"I wouldn't rule it out because there does indeed seem to be some movement in [Belarusian] relations with Europe," he said. "Maybe that's why we're taking this tack with the U.S. In other words, we won't give them an inch. At the same time, our trade with America is not too big. But I wouldn't rule out another version either: It might be that this situation is being played out by the West according to a 'good cop /bad cop' scenario. One side [Europe] is heading toward cooperation, albeit slowly. The other side [the United States] is getting tougher."
Lukashenka has recently been making friendly overtures to the West ever since Russia began to drastically increase the price of oil it exports to Belarus -- prices Belarus has trouble paying.
Earlier this year, Lukashenka ordered the release of several political opponents from prison as a gesture to the West. Washington welcomed the releases, but said it wouldn't start talks on improving relations unless he freed one more prisoner, Alyaksandr Kazulin.
Kazulin opposed Lukashenka in the 2006 presidential election campaign and was arrested during a protest after Lukashenka won a new term in office.
The Belarusian government freed Kazulin long enough for him to attend his wife's funeral last month, then put him back in prison.
At the State Department, spokesman Casey said it is regrettable that Belarus decided to confront the United States rather than work with it, especially after making the gesture of the initial prisoner release.
"We are appreciative of the fact that they have released several of the political prisoners, and we in fact noted at the time that if they were to release the remaining political prisoners -- very specifically Mr. Kazulin -- then we might be in a position to engage with them and begin a dialogue on how we might be able to improve relations," Casey said. "But frankly if the Belarusian government wishes to shoot itself in the foot, they're welcome to do so."
RFE/RL's Belarus Service correspondent Bohdan Andrusyshyn contributed to this report