In June 2003,Moscow prosecutors arrested Yuko's security on charges of organizing the execution of Petukhov.

Four months later they arrested Khodorkovsky on charges of fraud and tax evasion.Tax authorities seized the Neftyugansk subsidiary and handed it over to a Kremlin-controlled company called Rosneft.Khodorkovsky was convicted and carted off to jail in southern Siberia,where his face was slashed by an inmate.Meanwhile,the security chief was convincted in a trial heavily publicized on state television.In the lastest development,prosecutors announced last February that Yukos co-owner Leonid Nerzlin also would be charged in Petukhov's murder.



Perhaps it did happen the way the government claimed,but ask folks in Nefteyugansk about the murder,and they tend to shrug and say they don't know what to believe.The coordinated elements of the Yukos affair have the whiff of a Moscow plot hatched by the KGB types in control of the Kremlin.The result,in any case,is that a cash cow-and still the town's livelihood-has passed from the hands pf a Moscow oligarch into the hands of the Kremlin.What I show up in town,Sergey Burov has been mayor for four months.He was once a deputy director for Rosneft and before that a senior manager for Yukos.He,too,is no stranger to violence.In 2005,while walking to his car in the morning,he took a bullet to the stomach.It looked like another contract job,but prosecutors closed the case without finding a culprit.



Burov is a burly man whose wide shoulders stretch his suit.He is interested in talking about the town's future,not its bloody past.In parntership with Rosneft,he tells me,the city administration has ambitious plans to redevelop Nefteyyugansk.Come back in two years,he says,and I will see an entirely different town,maybe even a yacht club.After the interview his press secretary shows off an indoor sports facility with an Olympic-size swimming pool.In the central plaza,the onel littered with pipe just a few days earlier,workers are starting to install brick walkways and flower beds.



Are things finally looking up for Nefteyugansk?Residents seem skeptical.Maybe Roseneft feels better being here,Vasily Voroshilov,a 52 year-old oil well repairman,says.But we don't feel it.That skepticism is shared by many observers outside Russia,who say it's one thing to seize control of an oil company and quite another to run it.Says one analyst of the Kremlin's takeover of Russian oil,You can steal a Chevy,but that doesn't mean you know how to drive it.For all the wealth that oil can produce,it is often as much a curse as a blessing for countries such as Russia.Early in the 1990s,before the oil boom,Boris Yeltsin encouraged local provinces to grab what autonomy they could.This was when Russia's potential for political pluralism and Western-style grassroots democracy looked greatest.When oil prices rose toward the end of the decade,the Kremlin realized that this source of wealth could be used to bring about a humiliated Russia's global resurgence.Salvation by oil has since become an article of national faith.





Oil said a 16 year-old student at Khanty mansiysk's school for math whizzes,is the only way for our country to stand up,to survive.Actually,there are many ways that the Russians,a creative and educated people,can revive their country.But oil suggests national potency,and Russia's petroleun patrimony lends itself to patriotic incantations of an almost mystical kind.At the festivities on Oilers's day one of the songs,a salute to the collective might of the neftyaniki,proclaimed,We are the fingers pressed thightly into a fist.Russia's superpower status today comes from energy,not its military,says Julia Nanay,a senior director at PEC Energy,a global consultancy based in Washington D.C. The Kremlin determines what happens with oil in western Siberia.They want to control production and exports in order to maximize Russia's geopolitical relevance.Just as the tsars of old exercised monopolies on valuable commodities such as fur and salt,the Kremlin wants direct control over oil-and over the oligarchs who produce it.Those who come to heel survive,those who don't risk suffering Khodorkovsky's fate,or worse.




One of the survivors is Vagit Alekperov,president of Russia's biggest private oil company,Lukoil.Starting out working on the rigs near his native Baku,Alekperov was sent to Siberia in the late 1970s to manage an oil-production team.A notoriously strict paternalist, he angered his men by banning the sale of alcohol in the village.Several of them grabbed hunting rifles and fired shots at his cabin,but Alekperov,ever the survivor,wasn't there at the time.During the fina days of the Soviet Union,Alekperov forged Lukoil from prime oil assets in western Siberia.Today the company is a global multinational with hydrocarbon reserves second only to ExxonMobil-and some 2000 gas stations in the U.S. Though most of Lukoil's reserves are in western Siberia,Alekperov keeps his headquarters just two miles from the Kremlin.Like other survivors,he knows that he must be attentive to any change in political mood that could affect Lukoil's fortunes,for better or worse.A distinguished-looking man with bronze skin and a crop of steel gary hair,Alekperov dresses in impeccably tailored suits.A tough guy,he can also charm.When pressed on whether oil consumers around the world should feel comfortable now that Russia has a large finger on the globe's petroleum tap,he leaned back in his chair.smiled expansively,and asked,Do I look like a bear?I couldn't help laughing.We just want to make money.Having gobbled up Yukos,might the Kremlin want to swallow Lukoil next?I don't think either the government or the president of Russia will target such a company,Alexperov remonstrates.I decide not to mention that Khodorkovsky had told me the same thing not long before his arrest.



Lukoil's base of operaions in Khanty-Mansi is the town of Kogalym.A roadside floral arrangement spells out the company's name not far from the golden domes of a Russian Orthodox cathedral and the green minaret of a mosque.At a refurbished maternity house-what Russians call a roddom-Dr. Galina Pustovit,director of the gynecology department,show off new Western-standard medical equipment.In a country where many women deliver their babies in Soviet-era buildings reeking of sour cabbage and damp concrete,this gleaming facility rates four stars.When I mention the Pustovit that Russia's oil industry is known for being corrupt,the doctor gives me a sharp look.This is oil,she says,sweeping a hand around the gynecology ward.Oilers built this hospital.All of the objects in this city have been built with oil money,including our beautiful boulevard.Don't judge us too harshly,her looks say.Life in these parts has never been better.