Venus Williams squandered a match point before losing 2-6, 6-3, 7-5 to 46th-ranked Carla Suarez Navarro in the biggest upset so far at the Australian Open. Venus hardly looked like the reigning Wimbledon champion against the 20-year-old Spaniard, who reached the French Open quarterfinals last year as a qualifier in her first Grand Slam. Usually the aggressor with her powerful shots, sixth-seeded Venus was sluggish Thursday as she was broken while serving for the match and dropped the last five games with the crowd cheering loudly for Suarez Navarro to finish off the victory. “She was super consistent and aggressive and just went for her shots,” said Venus, who has seven Grand Slam titles and now can only hope for a doubles crown here with sister Serena Williams. Serena struggled earlier and headed to the practice courts after a 6-3, 7-5 win over Argentina's Gisela Dulko, ranked 45th. Serena gave her performance a “D-minus at best.” Rafael Nadal got high marks for a 6-2, 6-3, 6-2 win over Croatia's Roko Karanusic. His potential semifinal rival, fourth-ranked Andy Murray, wasn't seriously challenged in his first real test, ousting 51st-ranked Marcel Granollers of Spain 6-4, 6-2, 6-2 in 1 hour and 50 minutes. The top-ranked Nadal has dropped only 11 games in six sets and next faces Germany's Tommy Haas, who beat Flavio Cipolla of Italy. Nadal's biggest problem was finding a rhythm against the inconsistent, 92nd-ranked Karanusic, who has never made it past the second round in 11 Grand Slams. Murray only had to be on court only 45 minutes in Tuesday's stifling heat before Andrei Pavel retired with a back injury. With Scottish flags and tartan hats scattered around Rod Laver Arena on a cool Thursday night, Murray had 37 winners to 18 for Granollers. He credited a rigorous offseason training program. Suarez Navarro, overmatched at first, broke twice in the second set as the 28-year-old Venus let a number of reachable shots fly past. She saved a match point while serving at 4-5 in the deciding set and broke in the next game, aided by a Venus double-fault. Venus netted a forehand on match point in the next game for her 37th enforced error. Serena looked to be headed to a quick victory - by the time Dulko hit her first winner, she already was down 3-0. But the Argentine soon was matching the powerful Serena shot for shot. She saved triple set point while serving at 2-5, but Serena finished it off the next game with a pair of aces. In the second set, Dulko - who said she wasn't sure she'd be able to play after running a high fever following a doubles match Wednesday - served at 5-3 in and held six set points in a game that went to deuce 12 times. But Serena hasn't won nine Grand Slams by caving in to pressure and finally converted breakpoint No. 7. Olympic champion Elena Dementieva improved her 2009 winning streak to 12 matches by beating Iveta Benesova. Amelie Mauresmo rallied to beat Britain's Elena Baltacha, while fellow Frenchwoman Virginie Razzano ousted No. 14 Patty Schnyder of Switzerland 6-3, 6-1. Other women advancing included No. 8 Svetlana Kuznetsova of Russia, No. 12 Flavia Pennetta of Italy, No. 13 Victoria Azarenka of Belarus, No. 18 Dominika Cibulkova of Slovakia, No. 21 Anabel Medina Garrigues of Spain and No. 22 Zheng Jie of China. On the men's side, No. 9 James Blake won in straight sets for the second time, never dropping serve while beating Sebastien de Chaunac. Four seeded Frenchmen also advanced. Fifth-seeded Jo-Wilfried Tsonga, last year's runner-up, had a tough 6-7 (4), 7-6 (8), 7-6 (7), 6-2 win over Ivan Ljubicic of Croatia. He joined No. 6 Gilles Simon, No. 12 Gael Monfils and No. 24 Richard Gasquet in the third round. Also winning were No. 13 Fernando Gonzalez of Chile, the 2007 runnerup, along with No. 14 Fernando Verdasco, No. 17 Nicolas Almagro and No. 31 Jurgen Melzer.