Two dual U.S.-Russian citizens arrested for allegedly aiming to undermine oil market

MOSCOW -- Russia has charged two brothers with dual Russian-U.S. citizenship on charges of gathering secret information aimed at giving foreign oil companies a competitive advantage, the Federal Security Service said Thursday.

The service said one of the men was an employee of TNK-BP, a major Russian oil company half-owned by British Petroleum and that the other, his brother, was an employee of the British Council, the overseas cultural arm of the British government.

A spokeswoman for the British Embassy in Moscow, however, said the latter man, Alexander Zaslavsky, was not a council employee but a member of the "Alumni Club," a group set up by the council for Russians who have studied in the United Kingdom.

Police searched the Moscow offices of BP and TNK-BP on Wednesday. TNK-BP declined to comment, and the U.S. Embassy had no immediate comment.

The Wednesday searches turned up "business cards of representatives of foreign defense departments and the [U.S.] Central Intelligence Agency," an FSB statement said.

It was not clear whether either of the arrested brothers was believed to have foreign intelligence connections.

They were arrested "in an attempt to receive confidential information, commercial secrets, from a Russian citizen" who was an employee of a leading Russian oil company, the FSB said.

The information was intended "for the use of foreign oil and gas companies with the goal of obtaining a concrete advantage over Russian competitors," the FSB said.

Raised tension likely

The arrests are likely to raise tension between both Britain and the United States and the Kremlin.

Russian relations with Britain have been especially troubled since the 2006 murder of renegade FSB agent and Kremlin critic Alexander Litvinenko, who was poisoned with a rare radioactive substance in London. Russia has refused to extradite the man identified by Britain as the main suspect in the case, and each country has expelled some of the other's diplomats in connection with the dispute.

Russia this year ordered the closure of British Council branch offices in St. Petersburg and Yekaterinburg. The council acts as the British government's cultural arm overseas, but Russia contends it is a commercial operation.

Litvinenko was a close associate of Boris Berezovsky, the Russian tycoon who fled to Britain and received asylum after becoming a Kremlin critic.

Russia has repeatedly sought his extradition.

On Thursday, Russia charged Berezovsky in absentia with lying in his claims last year that Russian agents had tried to kill him.

TNK-BP came under massive official pressure last year, when government regulators said it was not meeting production targets at a giant Siberian gas field and threatened to withdraw its license.

The Kremlin has increased pressure on foreign energy companies in recent years as part of its effort to consolidate control over the country's largest and most important hydrocarbon deposits.

BP price talks ongoing

BP agreed in June to sell its stake at the Kovykta gas field to state gas monopoly OAO Gazprom, but talks on the price have continued.

Some observers suggested that Wednesday's searches could be part of Gazprom's efforts to pressure the British oil company into lowering the price. It added that another state energy company, OAO Rosneft, could also be interested in buying some of TNK-BP assets.

Searches and document confiscations accompanied a massive government crackdown on the Yukos oil company, which ended with an eight-year prison sentence for its founder, Mikhail Khodorkovsky, and the transfer of its assets into state hands.