Voloshin handed in his resignation - and according to rumours over the past few days he quit - after finding about the arrest of Yukos chief Mikhail Khodorkovsky ... only after it happened.

Putin has named Dmitry Medvedev, former first deputy chief of staff, as Voloshin's successor.

The Kremlin announcement came after days of political turmoil and media speculation that the powerful Kremlin aide had resigned over the controversial arrest of Khodorkovsky.

This has been described as a battle between Putin's own power circle and Moscow's business elite, which has threatened to damage the fledgling democracy. 

Influential

A quiet power behind the Kremlin throne who was always at Putin's side at top meetings, Voloshin, 47, held the third highest-ranking post in the Russian hierarchy and was seen as an advocate of liberal reform and big business interests.

Voloshin, who survived the Yeltsin era to cross over and serve Putin, was also the leader of a faction in the Kremlin sympathetic to Khodorkovsky.

"President Vladimir Putin has signed an order relieving Alexander Voloshin of his post as chief of presidential staff," the Kremlin said in an official statement released late on Thursday.

The Kremlin did not specify whether Voloshin had handed in his resignation.

Tumultuous

A quiet power behind the Kremlin throne for over four years, Voloshin is replaced by his former first deputy Dmitry Medvedev, who oversaw economic affairs in the presidential administration, the Kremlin statement said.

A former administrator in Putin's native city of Saint Petersburg, Medvedev, 37, currently serves as chairman of the board of directors of the state-dominated natural gas giant Gazprom, one of Russia's most powerful companies.

Over his three years in Gazprom, "many events happened, including tumultuous ones, which had seen Medvedev behave very courageously both as a good lawyer and a politician," fellow director Boris Fedorov said as quoted by ITAR-TASS.

Medvedev was appointed to the Kremlin staff in 1999, becoming Voloshin's first deputy in June 2000, three months after Putin was sworn in as president.

Oil tycoon Khodorkovsky – Russia's richest man -  was arrested last Saturday. He is now in jail, charged with several counts of fraud and theft of state property.

But the crackdown on the tycoon is widely seen as political since Khodorkovsky had been funding opponents of Putin.

* More details in Economy News