Obama recently sent a personal letter to Russian President Dmitry Medvedev. It contained several policy "proposals" and "assessments" of the current political situation, a spokeswoman of Medvedev said Tuesday, according to Russian news agency Interfax.

There has been some significant speculation over the letter's exact wording. Obama on Tuesday corrected a New York Times report that had claimed the letter included an offer to ditch the controversial U.S. missile defense shield in exchange for Russian help to stop Iran's ambitions for nuclear missiles.

Obama said the letter did not include "some sort of quid pro quo" deal, but instead was a repetition of what he had previously stated about the missile shield -- that it was directed at Iran, and not Russia.

"And what I said in the letter was that, obviously, to the extent that we are lessening Iran's commitment to nuclear weapons, then that reduces the pressure for -- or the need for -- a missile defense system," Obama said. The president added he wanted to "reset or reboot the relationship" with Russia.

No matter what the literal content is, the Kremlin has been pleased by the letter and what Russia's president has made out to be an increased flexibility regarding the missile shield.

"Our American partners are willing to discuss this problem, and that's already a good thing," Medvedev said Tuesday in Madrid after meeting with Spanish Prime Minister Jose Luis Zapatero. "Just a few months ago we were hearing different signals: The decision has been taken, there is nothing to talk about, we will do what we have decided."

While Medvedev -- in line with Obama -- said no trade-offs had been proposed in the letter, it is clear that Washington hopes for greater Russian engagement in persuading Iran to drop its nuclear program. The United States and Russia have shared interests in resolving the conflict, and successful joint diplomacy with Iran could be the start for better ties between the two powers, observers say.

But for that dream to become reality, a few roadblocks have to be hauled out of the way first.

The Kremlin has been extremely irritated by the North Atlantic Treaty Organization's eastward expansion. Russia believes the alliance has turned from a security coalition into a geopolitical tool used by the United States to increase its political and economic clout in Eastern Europe.

"For Russia, NATO is a geopolitical challenge and a threat," Sergei Karaganov, chairman of Russia's Council for Foreign and Defense Policy, said Tuesday at an event of the German Council on Foreign Relations in Berlin. "The expansion of NATO has become the main threat to European security."

Obama has promised to shake up U.S. foreign policy by trying to improve ties with the Kremlin. While he isn't expected to radically alter NATO's approach, a good start could be to scrap the controversial missile system, as Medvedev is just as opposed to the plan to station U.S. rockets in Poland and a radar unit in the Czech Republic as Prime Minister Vladimir Putin is.

The system could be a great bargaining chip, not least because experts close to the Obama camp have questioned its financial and practical feasibility. The logic seems to be: Why not give up a costly program we are not convinced about in the first place, and get friendly diplomacy in return?

The next steps to that strategy will likely be discussed at a meeting between Secretary of State Hillary Clinton and Russian Foreign Minister Sergei Lavrov on Friday in Geneva, Switzerland -- the highest-level talks between the two powers since Obama took office.

Medvedev's spokeswoman said she hoped the meeting would culminate in "specific proposals that will subsequently form the basis for discussion" when Medvedev and Obama meet at the Group of 20 economic summit next month in London.

Alexander Rahr, a senior Russia expert with the German Council on Foreign Relations, said Tuesday in Berlin he expected "real improvements" for U.S.-Russian relations, resulting in greater implications for Russia's overall ties with the West.

"If Obama binds Russia into a new strategic alliance, then Europe will follow that direction," he said.

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