The Kremlin will continue to use energy exports to exert pressure on several former Soviet republics to preserve Russia’s political leverage vis-a-vis their governments. Last spring, Estonia accused Russia of launching a cyber-attack on government, banking, and media websites in the country to punish its leaders for ordering the removal of a Soviet-era war memorial from the centre of the capital city.

Despite a deal reached between Putin and Ukrainian President Viktor Yushchenko in February, Gazprom, Russia’s natural gas monopoly, has again threatened to cut off supplies to that country. If Ukrainian Prime Minister Yulia Tymoshenko decides she can score domestic political points by antagonising the Kremlin, she could provoke another gas disruption by challenging the Putin-Yushchenko agreement. Ukraine gets 71 per cent of its gas from Gazprom.

Washington and Moscow will continue to butt heads over a US plan to deploy components of a missile defence system in Poland and the Czech Republic, Moscow’s suspension of its commitments under the Conventional Forces in Europe treaty, and its weapons sales to Iran, Syria and Venezuela. In particular, Russia’s decision to complete construction of Iran’s nuclear reactor at Bushehr and to provide Tehran with advanced air-defence systems will undermine any Bush administration attempt to salvage the warm relations Bush and Putin appeared to enjoy when the two first met.

An election year in the US will widen the divide. Presumptive Republican nominee John McCain has called for “revanchist Russia” to be excluded from the G8 group of industrialised nations. Likely Democratic nominee Barack Obama would take a less confrontational approach, particularly since he hopes to work with the Russian government to secure Soviet-era nuclear weapons and material. But he argues that Washington “must not shy away from pushing for more democracy and accountability” in Russia — a message unlikely to receive a warm reception from the Kremlin.

... contd.