The Bulls Have Left Moscow.(Periscope; Foreign Markets)(Russian stock markets)

Byline: Owen Matthews

Under Vladimir Putin, it seemed, no Kremlin ploy could shake world confidence in Russian markets. The 2004 jailing of tycoon Mikhail Khodorkovsky on politically motivated charges sent the market into a swoon, but recovery was swift as oil prices rose. In 2005 Russia's top foreign-portfolio investor, Hermitage Capital's Bill Browder, had his visa revoked after criticizing the secretive books of Kremlin-controlled companies. The market barely flinched. Last year, after the Kremlin pressured Royal Dutch Shell into selling offshore-gas operations to state-owned Gazprom at a below-market price, the capital kept rolling in. But has the well of confidence finally run dry?

The flight of Robert Dudley may have drained the last drop. The CEO of a joint venture between BP and Russia's TNK oil company, Dudley left Moscow on July 24 after months of harassment aimed at pushing the British partners out. Federal agents raided TNK-BP headquarters, a "technicality" left most BP staffers without visas and finally prosecutors threatened Dudley with labor- and migration-law violations. Over the next week Russian stocks fell 12 percent; they're now down 2 percent for the year, while other oil-rich developing nations are still up: Brazil by 8 percent, the gulf states by an average of 28 percent. The drop comes despite the fact that ...