Vladimir Putin's return to the Russian presidency next year will complicate the Obama administration's efforts to advance arms-control and trade agreements, adding to already deep suspicions among U.S. policy makers and lawmakers about the country's intentions and direction.
After the two nations cut a deal last year on a major nuclear-arms reduction treaty, talks have foundered over the next steps in reducing Moscow's arsenal of tactical nuclear warheads and in overcoming its objections to a new missile-defense system for North Atlantic Treaty Organization members—areas in which Mr. Putin has at times publicly played the role of lead skeptic.
President Barack Obama had forged a close working relationship with President Dmitry Medvedev, whose weekend announcement that he will step aside cleared the way for Mr. Putin's return to Russia's highest office. Officials in Washington had hoped Mr. Medvedev would become a counterweight to what they described in a series of State Department cables released by anti-government-secrecy group WikiLeaks as a "virtual mafia state" run by Mr. Putin. And the attention Washington lavished on Mr. Medvedev left people close to Mr. Putin feeling the prime minister was being snubbed, according to those people.
Mr. Putin declared his candidacy for the presidency at a pro-Kremlin party congress in Moscow on Saturday. He is virtually certain to prevail in tightly controlled elections in March.
The news of the anticipated switch at the top, which could reinstall Mr. Putin as president for as long as two terms, or 12 years, affirms Russia's slide into what many see as a police state.
The White House sought to play down the impact of Mr. Putin's return and what it means for President Obama's "reset" in relations with Moscow.
"The reset has always been about national interests and not individual personalities," said Tommy Vietor, White House National Security Council spokesman.
Added a senior Obama administration official: "We are sober-minded here. This is not a change in the political system because we have always known what the political system was."
Still, in a sign that the transition might not go as smoothly as Mr. Putin had anticipated, Russia's longtime finance minister said he won't serve in the next government.
Finance Minister Alexei Kudrin had earned the respect of investors by running a string of fiscal surpluses in the boom years of Mr. Putin's first two presidential terms. Investment managers said they were left uncertain whether Mr. Putin could effectively continue Mr. Medvedev's program of modernizing the economy.
Mr. Medvedev is clearly favored in the U.S. as Moscow's conciliatory face to the outside world, in contrast to Mr. Putin's confrontational style. Lawmakers in Congress are particularly leery of Mr. Putin and could complicate the Obama administration's efforts to pursue arms-control and trade agreements with Russia.
The White House has been trying to help Russia gain entry to the World Trade Organization, prodding Congress to abrogate the Jackson-Vanik amendment, a Cold War-era human-rights law that imposed trade sanctions on countries restricting emigration and was intended to pressure the Soviets to allow the exit of Soviet Jews to Israel.
Although Russia long ago abolished such exit restrictions, the law remains on the books.
David Kramer, head of the U.S.-based nonprofit group Freedom House, said Congress's attitude may change with Mr. Putin's formal return. "Putin is not held in high regard in the U.S. Congress," Mr. Kramer said. "This will not help with Jackson-Vanik." He added that the news represented "a major step back" for bilateral relations.
While Mr. Medvedev has championed WTO membership for Russia, Mr. Putin has been much more skeptical in public about the value of entering the organization. Mr. Putin has, in contrast, argued for greater protectionism and for building a trade bloc of former Soviet republics.
Administration officials, aware that Mr. Putin could well return to the presidency, say they have deliberately sought to avoid any appearance of playing favorites between the two leaders.
For protocol reasons, Mr. Obama has spent more time with Mr. Medvedev because they are both heads of state. They also see each other at multilateral meetings attended by Mr. Medvedev, rather than Mr. Putin.
But when Mr. Obama visited Russia in 2009, he saw both leaders, and when Vice President Joe Biden visited Russia earlier this year, he also met with both men separately.
Mr. Obama had argued to Congress that a reset in relations with Russia is in the U.S.'s interest. Amid some signs of warming, Russia has put some pressure on Iran to drop its nuclear-weapons program, and it has recently allowed the U.S. to ferry military supplies across Russia to Afghanistan.
The Senate in December ratified a major nuclear-arms reduction treaty with Russia. But talks over further reductions have foundered.
Greg Thielmann, a senior fellow at the Arms Control Association, a Washington think tank that promotes arms-control policies, said the changeover portends a shift in Russian style more than substance on these key policy issues. "But style and perceptions can affect substance over time," he said.
Perhaps the most sensitive topic between the two countries remains the U.S.-backed missile-defense system, which is designed to help NATO allies defend against the threat of ballistic missiles from Iran. Russia says it believes the system could blunt its own nuclear deterrent.
Mr. Putin has been more vocally skeptical than Mr. Medvedev on the issue, and the prime minister's spokesman Dmitry Peskov singled out the missile-defense dispute as a critical test of whether Mr. Obama is serious about a reset in relations.
"We have to prove the reset with concrete steps, not with words," Mr. Peskov said on Sunday.
U.S. and Russian officials acknowledged little progress has been made trying to work out a deal that would blunt Moscow's concerns. Russia has proposed combining NATO and Russian missile defense systems and creating a joint command and control structure. The U.S. has rejected that idea, arguing instead for "coordinated" but separate systems.
State Department cables released by the anti-government secrecy group WikiLeaks put a particularly blunt spotlight on what U.S. officials thought privately about the power dynamics at play in Moscow. In them, U.S. embassy officials describe Mr. Putin as an "alpha dog" who calls the shots and Mr. Medvedev as a hesitant figure who "plays Robin to Putin's Batman." In another cable, then-Defense Secretary Robert Gates is quoted as saying that "Russian democracy has disappeared" and that the government is "an oligarchy run by the security services."
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