Last week Vladimir Putin's triumphs in Ukraine lost some of their confident shine. After ruling it out, he now says that an early presidential election there could be helpful. He and his foreign minister have been saying different things in public. Whatever control he once exercised over the Russian rowdies in east Ukraine has been shaken. He, too, is subject to Murphy's law.

But before we conclude that the Russian president has done a U-turn, and start preening ourselves on yet another success for Western policy, we need to examine what he was after when he started his adventure, and whether he is now abandoning any of his original aims.

Putin has been interfering in Ukrainian affairs since 2004, when he failed to foist his man Viktor Yanukovych on the Ukrainian electorate. Yanukovych won a comparatively clean presidential election last autumn, but was ousted in February by a coalition of citizens who were sick of his incompetence, corruption and subservience to Russian interests, and rowdies from western Ukraine who were no better than their analogues in the east. Putin took all this as a personal insult: but he had solid objectives of policy as well. He believes, as do almost all Russians, that Russia has deep and legitimate interests in Ukraine, whose separation from Russia they find hard to understand or stomach. Like them he saw the offer of EU and Nato membership to Ukraine, and the West's meddling in Ukrainian internal affairs, as a provocative threat to Russian national interests and Russian security.

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Putin may be a brutal and vengeful man, but he is also a cunning politician with two useful attributes: he has a sardonic sense of humour and he knows when to stop. Russia's overweening oligarchs learned a brutal lesson after he exiled two and incarcerated another. A slowburning crackdown on the people who protested on the streets of Moscow three years ago against his corrupt regime left most of them thinking there was no longer much point in speaking out. Ordinary Russians probably cared little either way, provided he went on giving them the rising living standards they have come to expect.

And most Russians have been delighted with Putin's patriotic rhetoric and his successes abroad. He kept Russia out of the failed adventure in Iraq, he scored heavily over Syria, in 2008 he pulled off a short victorious war against Georgia. And he knows the rest of us need him. The Europeans need Russian gas and Russian business, the Americans need his help to deal with Iranian nuclear ambitions and to get their troops and equipment out of Afghanistan, and we all need Russian cooperation to counter international terrorism. "Sanctions" can work both ways.

Putin provoked a crisis over Ukraine to achieve three strategic objectives: a neutral Ukraine subject to Russian influence; more formal guarantees for the rights of Russian speakers in Eastern Ukraine; and the return of Crimea to Russia. The rest is tactics. Those he has used in Ukraine were similar to those he had used against Georgia: a bit of violence and bluff to get his way, and then a halt which left his opponents off-balance and himself in possession.

Ukraine is much larger and trickier than Georgia. Putin was never likely to send his army into the east, still less careering westwards through Odessa and into the Russian enclave in Transnistria as some excitable commentators have suggested. That would land him straight in a quagmire, something he is too canny to risk. The sorcerer's apprentices now on the loose in east Ukraine could complicate his neat plan. But there is as yet no sign that he is giving up his basic objectives. He would suffer a catastrophic loss of domestic prestige if he did.

As for what passes for Western policy, there is little evidence that it is responsible for Putin's shift of emphasis. He and his friends doubtless find our sanctions irritating, even damaging. But the crisis would have affected Russia's ailing economy in any case. That may eventually undermine Putin's domestic political position, but that time is not yet. Nato has belatedly sent troops to Poland and the Baltic States, something it should have done when the Russians first started bullying the Balts. The Europeans should have been reducing their dependence on Russian gas anyway: their feeble attempts are unlikely to affect Putin's present actions.

So the question remains: how are we going to negotiate about Putin's bottom line, with no strong levers to dislodge him?

The Ukrainians have managed their affairs badly, but they entirely deserve independence and a viable democracy of their own. Neither have been reinforced by the West's good intentions, its money, and its meddling. But the failure of Western policy goes deeper than that. The decision to enlarge Nato was taken in the mid-1990s on the basis of two assumptions: the Russians could not stop it; and Nato would never have to honour the military guarantee to which its new members would be entitled. We have an absolute obligation to the Balts, the Poles and the others who are now inside the fence. But we went on to dangle membership in front of Ukraine and Georgia without considering how to defend them if Russia chose to object by force. That was irresponsible, and a betrayal of two weak countries who thought they could rely on us.

It may well mark the end of the West's fantasy that, with the Cold War over, it could set the rules in what it chose to call a "postmodern" world and extend its idea of democracy almost at will by the superiority of its values and the overwhelming weight of its arms.

Sir Rodric Braithwaite was British ambassador to Moscow, 1988-92