It was Rudyard Kipling who used the phrase “great game” in his novel Kim, to describe the 19th century rivalry between Russia and Britain over the territory lying between the Indo-Pak Subcontinent and Russia.

The great game seems to be still on, albeit with a difference. It does not necessarily aim today at physically subjugating the region. In this ongoing game of chess, as some prefer to call it, energy is still the king. The main objective in the 21st century is to gain control and exploit the riches of the region by developing routes of gas and oil pipelines, that could carry the “black gold” from Central Asia and Caucasus to international markets.

The partners in the game at this stage, however, seem to be changing! Many in the West have perceived the emergence of Russia over the last few years as a major oil producing state, second only to Saudi Arabia, to counter balance OPEC. US oil majors had been instrumental in many ways in enabling Russia to increase its production capacity significantly over the last few years. They have been eager to help Russia emerge, for their own reasons, as an eminent power in the global energy markets. No one can deny that Russia has achieved this strategic objective.

A major policy shift in Moscow has resulted in stemming, to a great extent, the growing role of the US multinationals in the Russian energy sector, analysts believe. The arrest of Mikhail Khodorkovsky last October is believed by some to be a part of this wider strategy. Although charges against the billionaire were fraud and tax evasion, some say it was his attempt to break the Russian government’s pipeline monopoly that got him into trouble with the authorities.

“By pushing for building privately-owned pipelines, one directly to China and the other to Murmansk to better supply America, Khodorkovsky was pursuing a set of interests that was threat to the government’s policies,” a senior US administration official said earlier this year.

Khodorkovsky also had plans to merge his oil company Yukos with smaller rival Sibneft and then sell a chunk of the merged company to US oil major such as ExxonMobil. That, in the new scheme of things being unveiled gradually, may have been hard to accept in Moscow. Analysts feel that all talk of building private pipelines, or even of selling a stake in a major Russian oil producer to a US company is now taboo. This is in sharp contrast to Washington’s desires.

This is definitely not the scenario the United States wanted to see emerge. It would definitely like to see lots of private companies, private pipelines and more. Consequent to the Russian government’s policies, conditions have reportedly gotten worse for US oil majors that had a foothold in Russia, especially ExxonMobil, which lost its license to the giant Sakhalin-3 field late last year.

“All this seems to be eroding the US-Russia energy dialogue,” says Julia Nanay, a senior energy analyst at Petroleum Finance Corporation in Washington. While the developments may be bad news for Washington, Russia at the same time is also trying to lure the OPEC oil producers into dialogue. It is trying to emerge as a balancing force between the interests of OPEC and the US. The basic objective behind the Russian move is to increase its clout in the energy market.

In the past, while OPEC was cutting its output to keep oil prices within a certain range, Russia was cranking up exports at breakneck speed - affecting OPEC’s market share.

Russia has been raising its output since 1999 to a current level of around nine million barrels a day. Its aim is to hit 10 million barrels per day by as early as next year, says Semyon Vainshtok, head of the Russian pipeline monopoly Transneft.

A pivotal shift is the Russian energy policy seems to be in the offing. Last month, Russian Economic Development and Trade Minister German Gref stated that this year would be the last year of major export growth for the foreseeable future. Russian oil exports, according to Gref, would surge by 14 percent in 2004 to 266 million tons, but after that growth (in oil exports) would be minimal - around only two percent per year for several years to come.

In a period when many in this region are skeptical of the US policies and strategies, the Russian shift would be a consolation to many. Russia seems to be aware of this fact and is trying to capitalize on it by using its balancing power in this great game.

The Russian invitation to the OPEC chief to visit to discuss energy related issues could be seen in this backdrop. OPEC President Purnomo Yugiantoro has already announced that he would be going over to Moscow before the OPEC Beirut meeting in June this year to discuss energy related issues.

The Russian and the OPEC paths that were running in opposite directions for last few years, seem to be about to cross somewhere, sooner than later.

The Great Game is still on!