Russia’s reemergence as a major power in the international system has prompted renewed attention to developments in the country as well as to Moscow’s foreign policy actions and goals. Because oil and natural gas resources drive much of Russia’s growing power, the Kremlin’s domestic and foreign energy policies have been of particular interest to U.S. policymakers and observers of the country.

Growing global energy demand and rising energy prices provide essential context for Russia’s reemergence, simultaneously raising anxiety levels among the major consumer countries and raising confidence levels among the major producer countries. These tendencies have been especially apparent in Asia, a region that has seen sharp increases in energy consumption and is highly dependent on imported fuels. Yet, as has been the case in many other periods of rapid change, neither the anxieties nor the confidence will likely prove fully justified. Such is the unambiguous message of these two important articles by Mikhail Kroutikhin and Robert Legvold.

A central reason for this caution lies in a key conclusion that each author reaches independently: Russia’s foreign energy policy in Asia and elsewhere is driven largely by domestic political factors rather than by a well-elaborated and comprehensive international strategy. For his part, Kroutikhin sees Russia’s foreign energy policy as an almost accidental outgrowth of competition between three political “clans”—the “St. Petersburg lawyers”—connected to a degree to Prime Minister Vladimir Putin and somewhat more to President Dmitry Medvedev—who seek control over Gazprom, and particularly the company’s money; the siloviki, current and former security agency officials with statist political and economic views who dominate the oil sector, especially Rosneft; and the “Family,” the remnants of Yeltsin-era economic elites who continue to control major financial and metallurgical firms as well as some smaller energy companies.

In Kroutikhin’s view, Vladimir Putin led Russia in essence by serving as the balancer and referee in this intra-elite struggle over the country’s energy companies. Kroutikhin suggests, however, that although the ongoing instability ensured that Putin could remain in office, such a position also limited his authority; each group resisted—often effectively—decisions that threatened the group’s narrow interests. Thus any serious effort at developing a national energy policy was impossible. Legvold goes one step further, arguing that Russia’s foreign policy does not drive its energy policy; on the contrary, he argues that foreign policy is subordinate to the interests of Russia’s oil and gas complex and is consequently equally muddled.

Despite eight years of political tightening under former President Vladimir Putin, Russia’s government remains fundamentally weak. Moscow has struggled to pursue national projects in housing, healthcare, agriculture, and education. Russia has also failed to lift many other major policy initiatives off the ground, and has at times retreated from key goals in the face of public opposition.

Moreover, although the Kremlin has effectively subjugated the regions, the oligarchs, and the media (none of which are prepared to confront the state), Kremlin officials remain unable to manage their own employees—the Russian federal government—effectively. This is a result not only of weak institutions, excessive bureaucracy, and poor inter-agency coordination, but also of Russia’s enduring corruption, which Kroutikhin addresses in detail.

Download Russian Energy Policy and Strategy, NBR Analysis

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Volume 19 Number 2, NBR Analysis
July 2008
Mikhail Kroutikhin, Robert Legvold, Paul J. Saunders

Russian Energy Policy and Strategy
Introduction: Eastern Promises—Russian Energy for Asia. 3
Paul J. Saunders
Russia’s Strategic Vision and the Role of Energy. 9
Robert Legvold
Energy Policymaking in Russia: From Putin to Medvedev. 23
Mikhail Kroutikhin

Visit Russian Energy Policy and Strategy NBR Website

The NBR Analysis (ISSN 1052-164X), which is published five times annually by The National Bureau of Asian Research (NBR), offers timely essays on countries, events, and issues from recognized specialists.

The National Bureau of Asian Research is a nonprofit, nonpartisan research institution dedicated to informing and strengthening policy. NBR conducts advanced independent research on strategic, political, economic, globalization, health, and energy issues affecting U.S. relations with Asia.

Drawing upon an extensive network of the world’s leading specialists and leveraging the latest technology, NBR bridges the academic, business, and policy arenas. The institution disseminates its research through briefings, publications, conferences, Congressional testimony, and email forums, and by collaborating with leading institutions worldwide.

NBR also provides exceptional internship opportunities to graduate and undergraduate students for the purpose of attracting and training the next generation of Asia specialists. NBR was started in 1989 with a major grant from the Henry M. Jackson Foundation.

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