State System of Administrating the Oil and Gas Sector

Dmitry Medvedev has passed the equator of his first presidential term. Considering the past two years one can already make conclusions about the work of the state system regulating the oil and gas sector launched in 2008. Its designer is certainly Vladimir Putin, who remains the main figure in the Russian economy and politics despite all speculations by experts. Yet, the new mechanism has some serious differences from what we observed during the eight years of Putin’s tenure.

Meanwhile, the political system is entering a new electoral cycle and more importantly a period of defining its configuration in the next six years at least, since a presidential term in office will be extended. The question is how the oil and gas sector will function in the pre-election period and how it will be managed after 2012. The answer to a great extent depends on whether Putin will return to the presidential post and what new layout of forces among elites will be. However, one can assume that Putin will remain a key element of the decision making system. It means that considering his style of managing the oil and gas sector one can already make conclusions about future control mechanisms over the sector.

The staff pressure is growing amid the upcoming elections; this can be explained simply. Main administrative and political clans have already started struggling for the future structure of power and their place under the minerals and political sun. Several tasks have to be solved simultaneously – to acquire the maximum amount of assets and to try to secure them against political risks that will inevitably emerge during the period of upcoming transformation of the political system. The decrease in the amount of free property, deterioration of economic parameters of work of the oil and gas sector in particular and the whole economy in general and the upcoming election cycle raise nervousness of elites and increase the number of staff conflicts.

The report will elaborate on the following issues:

• Vladimir Putin: conflict of role positions

  • What will outweigh: concern about the oil and gas business or search for funds for the elections?
  • The role of the sector during the election campaign

• Who is who in respective ministries and agencies

  • The system of even distribution of administrative resources between main oil and gas clans
  • Checks and balances in the oil and gas vertical

• Main bottlenecks in the system

  • Struggle between related ministries
  • Conflicts in the three-tier government system, their main reasons
  • Struggle between the financial and macroeconomic bloc and the industrial bloc in the government
  • The most difficult administrative questions: fiscal policies, control over oil exports, issuing licenses and defining tender conditions

• Forecast of evolution of the system of managing the oil and gas sector before and after the elections

The contents of the report: