There is a comforting thought for those alarmed by Vladimir Putin's large electoral triumph, in which he suggested that his opponents are traitors and foreigners out to commandeer the Russian state. It is oil and gas, which while they fuel Putin's confidence, could also step in and serve as a leash on his tendency to over-reach.
Putin's history closely tracks the inclination of petro-rulers to shift from hubris to malleability with the decline of oil prices. Oil and gasoline prices are currently high, but they also seem close to a tipping point at which consumer tolerance could break, demand fall, and prices plunge. Deutsche Bank's Paul Sankey is forecasting a more-than 25 percent long-term plummet from that inflection point, which he puts at $135 a barrel for European-traded Brent crude. If this scenario materializes, look for Putin to revert to a friendlier form.
Are there other under-appreciated aspects to Putin's return to the Kremlin? I asked a few O&G readers specializing on Russia to weigh in. Andrew Kuchins, who runs the Russia program at the Center for Strategic and International Studies in Washington, replies that insufficient attention has been paid to the impact for U.S. foreign policy in places like the Middle East. Kuchins writes:
While Putin may be conservative and pragmatic by nature, with the United States his emotions are more raw and palpable. We are likely to need Russia's support even more in the future in management of the Afghan drawdown and Iran, and his bargaining is likely to be tougher. And if domestic troubles intensify and he feels more threatened, certainly that will not bode well for ties with Washington. Already we see inclinations for closer ties with Beijing, and, in the context of the Arab Spring, with Iran as well. It is not hard to envision further drift in this direction given certain domestic and/or external developments.
Alexey Druzhinin AFP/Getty Images
Russian leader Vladimir Putin urges an end to absurdist doubt regarding his political longevity, and a focus on reality -- such as the triumphant energy deals with which he closed out 2011. Putin is referring to a surprising, double-flanking maneuver in Turkey and Ukraine that gives Russia the apparent advantage in the late stages of a contest for energy market -- and, some fear, geopolitical -- domination in Europe. But Putin's tenor also suggests a decided shift to the past in Russia's relationship with the world -- the "reset" of relations with the U.S. is over, writes the Financial Times' Charles Clover. Putin -- whose administration last week issued a formal report accusing the U.S. of "mass and flagrant abuses of human rights"
-- is clearly prepared for the type of fisticuffs last seen during the depths of the George W. Bush Administration.
Can one write off this clutch of anti-Western activity to domestic politics -- Putin singing a tune that he thinks plays well with Russian voters ahead of the March 4 election, in which he is seeking a return to the Kremlin for a third term? It seems more complicated than that -- Putin is playing to the gallery, but events outside Russia also are motivating him to behave at turns opportunistically; other times, they are causing him to lash out apprehensively.
Putin's energy gambit is an example of him acting on the opportunistic side, specifically in the realm where Russian politics frequently find animation -- in the construction, or blockage, of energy pipelines. In the current case, Putin has managed to seriously out-maneuver U.S. and European political leaders by advancing the prospects of South Stream, a proposed $21 billion natural gas pipeline from Russia to Europe, crossing underneath the Black Sea.
Olga Maltseva AFP/Getty Images
Steve LeVine is the author of The Oil and the Glory and a longtime foreign correspondent.