The international oil and gas industry—as well as Russia’s—is watching with incredulity as prosecutors bring a new case against former OAO Yukos Chief Executive Mikhail Khodorkovsky.
Can it really be happening again? You bet it can, and with all of the cloak-and-dagger stuff you’d expect from a country run by Vladimir Putin, a former KGB spy, and his entourage—or should one say henchmen? In any case, Khordorkovsky and Platon Lebedev, former head of international financial organization Menatep, suddenly found themselves under way from their Siberian prison and heading back to face the new charges in Moscow.
The charges, which are about as labyrinthine as one can imagine, are not really worth talking about in this space. They are simply the pretext needed to get the two men back into the public limelight for use as a diversion from the country’s current financial morass.
Good drama
You have to admit that it makes good drama to have such a wealthy man on trial when so many thousands—or perhaps even millions—of impoverished Russians are emerging from a frosty winter only to face an economy in freefall.
If you think there’s any exaggeration in that, just consider the most recent World Bank report that projects Russia’s gross domestic product to shrink more than expected this year—with ordinary people feeling the shrinkage more than most.
WB’s latest report for Russia forecasts its economy will shrink by 4.5% this year, or about 2.5% worse than Russian officials had expected. And they even see an upturn before yearend. Worse, WB also notes that Russia’s dependence on energy has become a liability—along with its reliance on capital inflows and borrowing abroad.
Klaus Rohland, WB representative in Russia, delivered the killer observation, saying, “At this point in the crisis, focus should shift to the people and slightly away from the financial sector because people are now affected by the crisis.”
Clowns needed
Focus on the people? You mean actually do something that would help the Russian people survive the crisis? Hmmm…you can bet that probably won’t be running through the mind of Putin or his, uhm, entourage.
No, what they clearly have in mind is a circus—especially if there is no bread—and who better to provide the entertainment than prosecutors intimating that Khordorkovsky and Lebedev are responsible for the country’s financial woes?
Underlying the new trial, however, is a point of real concern to Putin and his government. Some time ago, members of the Russian parliament were considering a plan that would allow Khordorkovsky his freedom for time already served.
Could anyone imagine the kinds of things the freed oilman—an insider—could say about the Russian government’s mishandling of the industry? Such talk would clearly lead back to high places, wouldn’t it?
In the absence of bread, bring on the clowns!
