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As at the time of the Cold War, Kremlinologists are able to assess much of the thinking in the Russian government by the appointments that are made – who is "in" and who is "out".

Definitely "in" at the moment is Igor Sechin, a long-time Putin confidant who was appointed deputy chairman of state-owned oil company Rosneft at the end of August. Thus suggestions that the Russian state is about to cash-in, for a second time, from selling Yukos assets have been given added credence.

Then there was the appointment of another from Putin’s inner circle, Vladislav Surkov, to the board of directors of state-owned oil company Transnefteprodukt.

What we could be witnessing here is the first stages in a widespread re-nationalisation of Russia’s biggest private assets. Given that background, it does beg Mr Fan’s question whether this is a good time to invest in Russia. Yet in the first half of this year, there was $8.7 billion of foreign investment in Russia.

Native Russian businessmen think differently. In the first half of 2004, $5.5 billion fled overseas, according to official figures. Roman Abramovich is not the only one to prefer his homes in Kensington and Sussex. The total by the end of the year could reach to $17 billion.

Some western companies have taken the hint. Société Générale and ING have just pulled out of a group of banks arranging a $600 million syndicated loan to the Anglo-Russian oil company, TNK-BP. HSBC decided to withdraw from an unsecured $500 million syndicated loan to the metals giant, Norilsk Nickel.

Given the terrorist-inspired potential for instability referred to earlier this week in an article in The Times by Loretta Napoleoni, this is almost certainly not a good time to seek investment opportunities in Russia.

The author of Terror Inc: Tracing The Money Behind Global Terrorism, provided a worrying insight into the inter-relationship between Al-Qaeda, Chechen rebels and notorious organised crime cells throughout Russia.

"The Chechen Islamist guerrillas, following the blueprint of the anti-Soviet jihad, were encouraged to become self-sufficient by linking up with the local criminal economy," Napoleoni wrote, "…[they] established business links with criminal organisations in Russia as well as Albanian organised crime and the Kosovo Liberation Army. These alliances proved fruitful in generating profits from the drug trade and the smuggling of contraband, especially arms."

It is a quarter of a century since the former German Chancellor, Willy Brandt, in his far-sighted report on economic trends, suggested that the decline in oil reserves would set up a global conflict between the richer northern hemisphere and the under developed south. Given President Putin’s policies on oil and terrorists, Russia might just prove to be the battleground.

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