President Vladimir Putin on Monday fully supported First Deputy Prime Minister Dmitry Medvedev as his successor - a move likely to ensure Medvedev's election in March 2008 when Putin leaves the office.
Putin's popularity and steely control is so strong that most observers expect that whomever he supports would be a shoo-in.
He made the statement in a meeting with representatives of the United Russia party - which is his power base and dominates parliament - and of three other parties. The parties told Putin they all supported Medvedev.
"I completely and fully support this proposal," Putin said, according to footage shown on state television.
Putin had long been seen as trying to choose between Medvedev, a 42-year-old business-oriented lawyer and board chairman of state natural gas giant Gazprom, and Sergei Ivanov, another first deputy premier who built up a stern and hawkish reputation while defense minister.
"Medvedev is not an extremist. He is not known for any kind of harsh views on politics, and apparently Medvedev better suits Putin's view of how to achieve continuity," said Lilia Shevtsova, an analyst at the Carnegie Moscow Center.
Although Putin is banned by the constitution from seeking a third consecutive term in office, he has indicated a strong desire to remain a significant power figure. He has raised the prospect of becoming prime minister, and his supporters have called for him to become a "national leader" with unspecified authority.
Although he holds powerful positions, Medvedev projects a mild-mannered public image and has been widely seen as a functionary devoted to Putin rather than as an independent thinker.
Putin reinforced that perception Monday by saying that electing Medvedev would pave the way for a government "that will carry out the course that has brought results for all of the past eight years."
The Russian stock market surged on the news, led by Gazprom, whose shares jumped 1.6 percent within a few minutes. The market also apparently was boosted by the end of long uncertainty over whom Putin would designate as successor.
The speculation about Putin's future has included the possibility that he could try to return as president. That possibility seemed potentially strengthened by the announcement about Medvedev, said Vladimir Ryzhkov, a prominent liberal politician.
"The strategy is as follows: Medvedev is a compromise choice because he will allow Putin to keep a free hand. If Putin wants to gradually leave power Medvedev guarantees him comfort and security and will continue to listen him," he said on Ekho Moskvy radio. "If Putin wants to return in two, three years ... Medvedev will be the person who will without a doubt give up the path for him."
Communist Party leader Gennady Zyuganov suggested another possibility, noting that Russia has recently shown increased interest in long-dormant plans to form a union state of Russia and Belarus. If a new country were formed, that could allow Putin to return to power as leader.
"Putin may become president of the union state by the end of the year," Zyuganov was quoted as saying by the news agency Interfax. "The nomination of Medvedev that was orchestrated from the Kremlin and the possible accelerated development of the union state are to Russia's great misfortune."
Putin is to travel to Minsk for meetings with Belarusian President Alexander Lukashenko on Thursday.
Both Medvedev and Putin worked under St. Petersburg's reformist mayor Anatoly Sobchak in the early 1990s. After Putin became prime minister in 1999, he brought Medvedev to Moscow to become deputy chief of staff of the Cabinet. He then moved up to become deputy chief of staff for the president, became Gazprom board head in 2002 and full presidential chief of staff in 2003.
In 2005, Putin named him a first deputy prime minister and almost immediately Medvedev began to receive extensive television coverage - even more than that accorded to the prime minister.
The disproportionately lavish coverage raised speculation that Putin even then saw Medvedev as his preferred successor. But Ivanov later was appointed to another first deputy premiership and began to receive equally wide TV coverage, suggesting that Putin was conducting an unstated competition or that there was jockeying for influence among Kremlin factions.
Deputy Chairman of the Russian Security Council Dmitry Medvedev presented a map in which Russia takes the entire territory of the former Ukraine