NOT only did the May bomb blast in Grozny kill Chechnya’s pro-Moscow President Akhmad Kadyrov, but it also dealt a severe blow to Russia’s drive to overcome disagreements with the Arab world over Chechnya and attract Saudi investment, highlighting similarities between the Iraqi and Chechen insurgencies.

During the 1990s, many Muslim nations, notably oil-rich Saudi Arabia and the Gulf states, criticised Russia for its crackdowns in Chechnya. But after Kadyrov was elected as the pro-Moscow Chechen ruler in October 2003, criticism somewhat subsided. In last January. Kadyrov, who was previously the region’s chief Muslim cleric, travelled to Saudi Arabia to seek much-needed investment and aid. He called on Saudi businessmen to invest in Chechnya to revive its oil sector. Kadyrov’s mission indicated possible wider cooperation between the world’s two biggest oil producers and exporters.

Shortly after Kadyrov’s mission to Saudi Arabia, Russia’s top oil company LUKoil signed a major agreement with the Government of Saudi Arabia for the development of natural gas deposits. LUKoil reportedly plans to invest up to US $200 million in the project.

Relations between Russia and Saudi Arabia were given another major boost in September 2003, when Saudi Arabia’s de facto ruler, Prince Abdullah bin Abdul Aziz, paid a historic visit to Russia. In that month, Russian and Saudi officials signed a five-year agreement on cooperation in the oil and gas sector. The framework accord could lead to deals worth up to $25 billion. It remains to be seen whether Kadyrov’s successor, who is to be elected by September this year, will be able to sustain contacts with Saudi Arabia.

Chechnya’s own crude oil production is relatively insignificant: it reached 36,160 barrels per day (BPD) (1.8 million tons) in 2003. In 2004, Chechnya aims to pump 40,270 BPD (2 million tons) of crude. Chechnya’s oil reserves, estimated at some 220 million barrels (30 million tons), are sufficient to support current crude oil production levels for some 15 years.

In the wake of its civil war, Chechnya needs the time and capital to repair the damage to oil-related facilities. Many of Chechnya’s oil wells are low-yield, and after being out of operation for years some wells may never be repaired. However, Chechnya’s oil resources have triggered some controversy: Kadyrov had insisted that the regional government take over local oil wells. He also wanted to have Chechnya’s oil revenues reflected in the republic’s coffers.

Meanwhile, the security situation for Chechnya’s oil sector remains unstable. In 2003, some 1.17 million barrels of crude were stolen from oil pipelines in Chechnya. Last month, separatist forces bombed four oil wells, setting them on fire.

With Moscow’s counter-insurgency efforts in Chechnya now having been dealt a serious blow, Russian President Vladimir Putin pledged "unavoidable retribution" for the terrorists responsible for the assassination of Kadyrov.

Russian politicians suggested a further crackdown on Chechen militants should take place. Dmitry Rogozin, head of the Nationalist Rodina Parliament faction, urged the Kremlin to impose direct presidential rule in Chechnya and punish the perpetrators of the attack.

The pro-Moscow Chechen government said in a statement that the bomb attack and Kadyrov’s demise "will unite the people of Chechnya to fight terrorism". The statement also described the perpetrators as "terrorists and criminals". Chechen officials also blamed separatist leaders Aslan Maskhadov and Shamil Basayev of complicity in the attack.

Exiled tycoon and vocal critic of Putin, Boris Berezovsky, lost no time to describe Kadyrov’s murder as "an absolute defeat of Putin in Chechnya". The Russian authorities "demonstrated their weakness", he was quoted as saying.

Kadyrov was not always pro-Moscow: he interrupted his religious studies in Oman in 1991 to join the rebellion in Chechnya. During the first war in Chechnya in 1994-1996, Kadyrov, then the region’s chief Muslim cleric, called on Muslims to fight a jihad against the Russian army. Yet when the second Russian campaign in Chechnya started in 1999, Kadyrov sided with Moscow, citing his desire to bring peace to the region. When Kadyrov won presidential elections in Chechnya he was virtually unchallenged, winning 81 percent of what some called a fixed vote.