Canada could be in a position to play a key role in this weekend's G8 negotiations, using its position as a global energy provider to find common ground with Russia and act as a mediator on tough issues.

Energy security is expected to be one of the top issues as the leaders of the Group of Eight top industrial democracies meet in St. Petersburg over the next three days.

And there are mounting fears that Russia will use its vast energy supplies as a bargaining tool -- cutting off the flow of crude oil to other nations when it suits its purposes.

Last January, Russia did just that, turning off the gas tap to Ukraine and causing consternation around the world, especially in western Europe, which is heavily dependent on Russian gas supplies.

World leaders don't want that to happen again, and are desperate to avoid a "crude war," with energy as the main ammunition.

The issue is likely to come up at the talks.

"We are accused of something like energy blackmail ... Some people think that yes, Russia in a case of crisis may use its supplies as a political tool," said Viktor Kremenyuk, deputy director of the USA and Canada Institute at Russia's Academy of Sciences.

But as the only other overall energy supplier in the group, Canada may be perfectly situated to serve as an intermediary between Russia and the other nations to help reach a solution on the issue.

"We may schedule something like a conflict, possible conflict, there, and the problem will be...who will be an intermediary? Canada may be one of the most welcomed," Kremenyuk said.

Russia's economy has rebounded from its near collapse in the mid-1990s thanks to surging energy prices.  On Thursday, oil prices hit a new intraday high of $76 US a barrel.

Some analysts, however, have warned that Russia's perceived shift away from democracy, and the government's slide towards authoritarianism will cast a pall over the talks.

One of the reasons Russia was admitted to the G8 in 1998 was with the hope that membership would help it move towards becoming a Western-style democratic nation.

Under President Vladimir Putin, however, the government has tightened its grip on the nation in decidedly undemocratic ways, taking control of the nation's television stations, shutting down independent newspapers and limiting public debate within the media.

And changes to the laws that govern the electoral process have added up to give the United Russia party a heavy advantage.

Those factors, critics say, hurt the credibility of the G8 as a whole, and Russia's presence at the table makes it more and more difficult for the group to be effective.

The question is whether G8 leaders will tackle the touchy subjects over the weekend.

"The leaders of western democracies have every reason to downplay this paradox, that they have an undemocratic Russia sitting at the head table and dictating the G8's agenda," Lilia Shevtsova, an expert with the Carnegie Centre in Moscow told The Associated Press.

"They will certainly paper over their differences, and make nice for the cameras, but this is a problem that is not going away," she said.

Among opposition leaders in Russia there is fear the visiting leaders will ignore the tough issues in exchange for other gains.

"The West is trading democracy, whether it's oil or the Iranian nuclear program of some other geopolitical interests," said opposition leader Garry Kasparov.

Putin told CTV's Ellen Pinchuk in a recent interview he believes there are other motivations for Western criticism towards Russia.

"I think this permanent criticism in issues related to democracy, freedom of media, those are just used as an instrument to interfere into the domestic and foreign policies of Russia with a view to affect and influence our policies," Putin said.