Local media reported late on Tuesday that Brazil's top prosecutor filed a request to investigate President Dilma Rousseff for possible obstruction of justice. The case would be the first time Rousseff has been directly implicated in the sprawling corruption scandal surrounding state-owned oil giant Petrobras.

This could well spell the political downfall of the president, who despite formerly sitting as chairwoman of the board, has managed thus far to avoid any graft charges related to Petrobras. Rousseff has consistently denied any wrongdoing, despite the fact that much of the billion-dollar kickback scheme happened during her tenure at Petrobras.

Some of Brazil's biggest construction executives have already been jailed and convicted for using Petrobras funds for bribes. Around 50 politicians are currently being investigated.

The president is also facing a separate impeachment process, on charges of violating budget regulations.

Rousseff: Scandal won't taint Olympics

Rousseff, however, did her best to remain upbeat as she greeted the Olympic flame on Tuesday ahead of this summer's games in Rio de Janeiro. She said that the scandal would not mar the event.

"We are experiencing political instability. We are going through a very difficult period, truly critical in the country's history and in the history of democracy," Rousseff said in the capital Brasilia, where the traditional Olympic torch relay began.

"I am certain that a country whose people know how to fight for their rights and to protect their democracy is a country where the Olympics will have great success in the coming months," she said, adding that the games would put the country's beauty on display, rather than its problems.

The torch, which arrived from the Greek site of Olympia by way of Switzerland, will now be carried by 12,000 people through 329 towns and cities before ending its journey in Rio's Maracana stadium on August 5. This will be the first Olympic Games hosted by a South American city.

es/msh (AFP, Reuters)