Today: Apart from waiting for news from the Italian parliament the other events today include an update on UK industrial production and the 2012 oil market outlook from OPEC. The IEA will publish its 2012 oil market outlook tomorrow. Neither report is expected to contain any major surprises and both are likely to re-state that the oil price remains dependent on the strength of demand from China, other Asia and other developing economies rather than from developed economies.

Gas to Germany. The other big event today will be the opening of Phase 1 of the NordStream pipeline that will take gas directly from Russia into Germany. This is an important event from a number of angles. It takes the advantage away from Ukraine and effectively kills off any threat of a repeats of the gas flow disruptions seen twice in recent years. But, much more than that, it is the first new pipeline from Russia to Europe since the end of the Soviet Union and it is the very first pipeline that does not transit another territory. It marks, to a greater extent than any other deal, the new economic and political relationship between Russia, Germany and the core EU countries. Germany explicitly accepts Russia as a reliable energy partner at a time when there are major question marks over its nuclear programme and over the reliability of possible alternative gas supply routes into Europe.

Energy barter. It comes at a time when Russia is very actively looking to improve its investment attractiveness in order to bring both foreign capital and foreign expertise into the economy. WTO entry by the end of this year is part of that transition, as are recent high profile deals with companies such as Siemens. Russia is targeting European companies – and Chinese money - to take a more active role in expanding the economy. The current talks between PM Putin and his Chinese counter-part are at least in part to try and advance the long outstanding gas contract talks to a conclusion. In that sense, the Kremlin is again bartering energy for trade and investment. This time round, however, the energy barter is not focused on the military sector but in efforts to expand economic diversity and modernize infrastructure.

Trading – Moscow: Moscow again took it’s lead from international markets yesterday. Opening caution lasted until European markets and Wall Street decided to take an optimistic view of events in Greece and Italy and that allowed the indices to close with net session gains for the day. Both had closed before the US markets took a second look at risk and headed lower. The RTS added 1.4% while MICEX closed 1.3% better. But, as with all markets, it is just a case of marking time while waiting for some directional catalyst. Rosneft was the main mover, closing 3.8% better as oil moved higher. Sberbank closed 2.0% better on MICEX. The ruble also saw support as currencies across Asia edged a little better and because of the support in the oil market. By the close of the session on MICEX the ruble was up 14 basis points against the dollar at 30.62.

Trading – GDR/ADRs: The London GDR market also followed the positive US opening and higher oil to end its session up 1.2%. Evraz rallied after last week’s slump, rising over 8% as it traded for the first day in its new format. LUKoil led the oil majors with a gain of 1.9% but other blue chips saw relatively smaller moves. Pharmstandard was the best mover yesterday, closing the day up 11.1% albeit with small volume. In the US AADR market, the S&P ended with a 0.6% gain having also spent the day alternating between small gains and losses. Yandex lost 3.4% while Mechel rose 3.7%