Either the Kremlin decided that Sakhalin was just too juicy a prospect to be left entirely to foreigners, and in effect pushed Shell into doing a deal with Gazprom. Whether that judgement is correct remains to be seen.Now Shell dances to Russia's tune tooBP has taken the direct route into Russia, buying a half stake in the country's second biggest oil company TNK, with all the risks and rewards which that entails. Shell, on the other hand, has opted for the more cautious, piecemeal approach of acquiring stakes in particular projects, notably the giant Sakhalin-2 development off the Siberian coast, where the biggest threat it faces is from environmental activists worried about the fate of the grey whale.Yesterday Shell announced it was trading just under half of its interest in Sakhalin, the biggest liquefied natural gas field in the world, for a 50 per cent stake in the as-yet undeveloped Zapolyarnoye field in western Siberia, owned by the state-run Russian gas concern Gazprom.There are two ways of looking at the deal. In characteristically clinical fashion, markets have made their judgement: yesterday's events might have brought London to a standstill, as well as revealed some serious failings in our security services, but the long-term economic and commercial impact is likely to be negligible. If fewer people are travelling into London because they fear for their lives in using public transport, less money is spent in the capital, and some traders might struggle to survive.

The costs of enhanced security place still further burdens on business.Memories are surprisingly short, and it may be that things get back to normal quite quickly. Londoners are a resilient and stoic lot who are unlikely to let these terrible events affect them unduly. Yet policy makers would be unwise to count on it, and although the Bank of England was undoubtedly right to think the atrocities should have no bearing on the immediate interest rate decision yesterday, if these events further undermine already fragile consumer confidence, then the MPC may have to act sooner and more trenchantly than it would have liked.By the close of play yesterday, a near 4 per cent fall in the FTSE 100 had been trimmed to less than half that. Yet people don't behave rationally after such an event.The collective psychological impact of a major terrorist incident, as well as the response to it, tends to be out of all proportion to the direct damage done or the loss of life caused This too can have a sizeable economic effect. It's plainly more difficult, if not outright impossible, to police mass transit travel to the same degree as airports, so the long-term effect on commuter traffic could be more serious still.For some, the fear of travelling by tube and bus will be hard to overcome. The chances of being caught up in a terrorist attack on the Tube are still a great deal less than many other life threatening occurrences. As for the damage and disruption, this will of itself be of only limited economic impact.The more pervasive effect comes, as in the wake of 11 September, in the costs of heightened security, and the effect this has on speed of movement and business activity.

The London transport system has long been thought a likely target for terrorists For many, it was only a question of when. The elation and pride of the day before, when London learned it would be hosting the 2012 Olympic Games, is replaced by a climate of fear and anxiety.Airline travel in the US, if not internationally, has only recently recovered to pre-11 September levels. Off and on, Britain has had 30 years of them.Among Londoners, there was an almost fatalistic attitude to yesterday's events. There had never before been a major terrorist incident on American soil.