Talking Energy

Sunday's meeting comes in the wake of an oil transit dispute between Russia and neighboring Belarus that disrupted energy supplies to Europe and further damaged Moscow's tattered reputation as a reliable partner.

The meeting has extra significance because Germany currently holds the presidency of both the European Union and the Group of Eight, the club of major economies in which Russia itself held the top role for the first time last year.

"They will definitely talk" about energy, Merkel's G8 advisor Bernd Pfaffenbach, said in an interview with Russian daily Vedomosti, adding that the row had "damaged Russia's authority."

"We will insist more firmly on the need for Russia to be a reliable partner in the long term," Pfaffenbach said. "We have a particular responsibility on this as president of the European Union."

Damaged reputation

Last week, Merkel, herself, also said Russia had damaged its image as a reliable partner by stopping oil deliveries through a main pipeline that runs crosses Belarus on the way to EU countries.

The German-Russian relationship has become less cozy since Merkel took over from her predecessor Gerhard Schröder. Last Friday, she stressed she could not describe Putin as "a flawless democrat," as Schröder once did.

"I haven't said that yet and I'm not saying that now," Merkel said.

Merkel has also put a stronger emphasis than Schröder on the need for strong European ties to the United States.

EU still needs Russian energy

But EU dependency on Russian energy means that links remain pragmatic.

"This does not mean the German chancellor is negative about Russia," German foreign policy expert Alexander Rahr wrote in the Russian government newspaper Rossiiskaya Gazeta. "She still tries to build pragmatic and reliable relations with Moscow."

On another important EU-Russia trade matter, Germany is hoping to clear the way for talks on a Russian-EU strategic partnership, which have been blocked by a Polish veto linked to a dispute over Polish meat imports into Russia.

German Foreign Minister Frank-Walter Steinmeier, however, said Friday that he was confident Poland and Russia would find an acceptable compromise.

"I am actually very optimistic that we will find a solution," he said. "I am very hopeful that the new negotiations (between the EU and Russia) can begin soon."

Mideast, Eastern Europe also on agenda

Talks on the Middle East are also likely, with the so-called "quartet" -- the European Union, Russia, the United Nations and United States -- planning a new attempt to kick-start stalled Israeli-Palestinian peace talks.

Merkel has made this a priority of Germany's EU presidency, while Putin is keen for Moscow to play a bigger diplomatic role in the Middle East.

Ahead of elections Sunday in Serbia, the two leaders will likewise have plenty to discuss on Kosovo, the mostly ethnic-Albanian province of the former Yugoslavia that is pressing for independence from Serbia.

Merkel told news agency Reuters in an interview Friday that a decision on the fate of Kosovo must bring "maximum" satisfaction to the citizens of the province without stirring turbulence in Serbia.

Russia is a strong ally of Serbia, which opposes allowing Kosovo to break away, and has suggested that if Kosovo becomes independent then the status of Moscow-backed separatist regions in Georgia, a pro-Western ex-Soviet republic, should also be reconsidered.

On Thursday, German Foreign Minister Frank-Walter Steinmeier said he favored measures that ensured autonomy for the ethnic-Serb minority in Kosovo.

He also underlined that Kosovo's case could not be compared to those in the Caucasus.