Many Basques would prefer a grand alliance between the Socialists and the PNV, but that looks unlikely to work.

ECONOMIST: Spain and its regions

His minority government relies on the backing of a handful of PNV deputies, who will now probably pull out.

ECONOMIST: Spain and its regions

The PNV's other demands, for more autonomy, may be even harder to meet.

ECONOMIST: Spanish politics

PNV's candidate to replace him is Juan Jose Ibarretxe , a 41-year-old economist.

ECONOMIST: Unmasking the Basque separatists

Even though it lacked money and access to the media, it won 1.2% of the vote in the March election, the same as the PNV.

ECONOMIST: How much is enough?

PNV's 39-year-old leader in Guipuzcoa, the most fervently separatist Basque province.

ECONOMIST: Unmasking the Basque separatists

It is hoping to oust the moderate Basque Nationalist Party (PNV) from the Basque parliament, and is even considering a pact with the Socialists to achieve this.

BBC: Analysis: ETA still poses threat

The PNV regional government, led by Juan Jose Ibarretxe, has been governing in minority since last year after suspending a parliamentary pact with Euskal Herritarrok (EH) - widely considered to be ETA's political wing.

CNN: Basque voters urged to reject ETA

Last month, ETA appeared to suffer a further setback when the Basque Nationalist Party (PNV), which advocates independence from Spain through peaceful means, won 33 seats in the 75-member parliament in Basque regional elections.

CNN: UK asked to extradite ETA suspect

The arithmetic of Spain's parliament, where the Socialists are seven seats short of a majority, and the decision of fairweather allies in left-wing and Catalan nationalist parties to withhold support, leaves the prime minister at the mercy of the six deputies of the Basque Nationalist Party (PNV).

ECONOMIST: Spanish politics