Putin likes controlling energy best - analyst

The format of the new Russian government and the Kremlin administration shows that Vladimir Putin still holds the reins of the two branches of power. Why then has he agreed to such a complicated and dangerous move to the post of prime minister, a prominent Russian analyst wonders.

According to Konstantin Simonov, head of Russia's National Energy Security Fund, Putin claims he respects the rule of law and the Constitution. Another argument is that he did not want to anger the West. But there is one more argument: the post of prime minister allows Putin to abandon political responsibilities and to focus on what he likes most - the economy, specifically energy.

Putin is viewed above all as a politician, but he prefers a business approach, Simonov writes in the popular daily Vedomosti. He knows that energy will remain Russia's main competitive advantage for a long time, even though it is developing as a post-industrial economy. Putin will have more room for maneuver in this sector, which is why he has proposed cutting taxes for the oil and gas companies, although earlier this year he spoke about the sector's layer of excess fat.

Putin was allegedly trying to restore the Soviet political empire and use energy as an instrument against the West. At that time, Russia needed to win its neighbors' loyalty with cheap gas, yet it raised prices.

The foreign expansion of Russian energy companies was not an element of political influence but a chance to earn more, the analyst writes. Putin acted as a businessman, trying to raise the price of the entry ticket to Russia's upstream sector for foreign corporations and gain assets in European downstream companies in order to increase Russian companies' revenues.

As president, Putin had to divide his attention between energy and political matters. When he went to the West, he was bombarded with questions about democracy and human rights. Now he can say that politics is the competence of the president, and therefore avoid difficult political issues. The Japanese can discuss the disputed Northern Territories with Dmitry Medvedev and LNG supplies with Putin.

Simonov writes that some people thought Putin would be sorry to lose the right to attend G8 summits. However, the group does not take serious decisions and is nothing more than a club discussing the fight against global hunger. Its politicians usually end up in business.

Source: Vedomosti (What the Russian papers say, RIA Novosti) - May 27, 2008