In a tough interview the BBC’s Richard Galpin asked Lord Mandelson four times if he had discussed cutting tariffs with Oleg Deripaska. Mandy tried using the same kind of spin lines that he bluffed with Sophie Raworth; “I’m not distracted by media squalls, sensationalist headlines… there was no conflict of interest, no impropriety”.

We know, as Trevor Kavanagh reminds us, that Mandelson is a proven liar, however he is not an idiot. He no doubt has heard the rumours of tapes and boasts by oligarchs that they have western politicians in their pocket. So perhaps the explanation for his reticence in answering the question, and uncharacteristic aversion to risking a lie to deny ever discussing tariff cuts worth billions to Deripaska, is the fear that he will be contradicted.

Paul Waugh reckons “the only sensible conclusion to draw is that Mandelson did indeed discuss the tariffs.” He is surely right.

Surely given that we are in a new cold war with Russia it would be safer from a security point of view to stay at the Embassy rather than the Baltschug Kempinski Hotel? Presumably the embassy is less likely to be as comprehensively bugged by the FSB as Moscow’s most luxurious hotel? It is normal for ministers traveling overseas to avail themselves of the Embassy’s guest rooms.

Could it be that Lord Mandy of Corfu has got so used to the high life of the oligarchs that he would rather lord it at a 5-star hotel. The British businessman he is with are staying in another hotel costing £300 a night, whereas his suite normally rents at circa £5,000 a night. They are paying their own bills of course. No credit crunch worries for Mandy, the taxpayer picks up his bill…

Guido’s man on the high seas tells him about a party thrown by Steve Ballmers Paul Allen on his yacht last year in 2005. Peter Mandelson was brought to the party by a third person – uninvited.

He was not a welcome guest and was avoided by many of the other party-goers who were only too well aware that the European Commission had fined Microsoft a record €497 million on competition grounds. Microsoft was engaged in a bitter legal battle to have the fine overturned.

With billions at stake it was surely inappropriate for the trade commissioner to meet socially with the second largest shareholder in Microsoft when it was in a fierce battle with the Commission. Over to you Peston…

Lord Mandy of the Dark Arts’ permanent secretary is Sir Brian Bender KCB. Just thought Guido would mention that. No juvenile sniggering at the back.

Why was Peston gunning, with Nick Robinson, for Osborne this morning on the Today show? Some speculate that it is payback for the generous tips of recent weeks that have come Pesto’s way. Guido suspects they are wrong.

Could it be something to do with the complaints to the FSA and the SFO from Tory MPs which, rightly or wrongly, Peston believes is being coordinated by Osborne’s office. Was there an element of personal animus? Surely not from the objective and impartial BBC….

Mandelson’s ability to get Nathan Rothschild, a Tory donor, to counter-attack Osborne over the “pouring poison” line is widely seen as a tribute to his powers of persuasion.

In reality Rothschild, who has long been enamoured with and in thrall to Tony Blair, acted after Mandelson got Blair to call Rothschild to encourage him to embarrass Osborne. M’learned friends are now being consulted as claim and counter-claim are spun. Isn’t it great to have all the fun of the circus with Mandelson back…

UPDATE : Tories say it was some time after the meeting that Rothschild called them to offer a donation on behalf of Deripaska. A Guido source laughed at the idea that Osborne and Feldman would personally solicit £50,000 – “that would get you to sit at the top table at a dinner maybe”.

CCHQ are calling Rothschild a liar:

The allegations made in Mr Rothschild’s letter are completely untrue.

Both Andrew Feldman and George Osborne deny absolutely that they attempted to solicit a donation from Oleg Deripaska. Nor did they suggest a method by which he could conceal a donation via a British company.

They spent a short period of time on Mr Deripaska’s boat at the invitation of Mr Rothschild. Donations to the Conservative party were not discussed with Mr Deripaska.

In a conversation on September 18, Mr Rothschild suggested to Andrew Feldman that Mr Deripaska wanted to make a donation to the party through one of his British companies. The offer was not taken up.

For clarity: the Conservative party has neither sought nor received any donations from Mr Deripaska nor any of his companies.

Looks like the lawyers will definitely be called in…

It is a fascinating world inside the ruling elite isn’t it? Rupert Murdoch parks his yacht offshore from Nathaniel Rothschild’s sunshine estate and drops in. Mandelson and Osborne take a ride in the same billionaire’s boat when not dining together. All very cosy, enough to turn you into one of those crazy conspiracy theorists…

Peter Mandelson drank Chinese milk 9 days before his kidney problems surfaced. He flamboyantly drank a glass in front of the Chinese media to “show his support for the Chinese dairy industry” which has been hit child poisoning contamination disasters.

Premier Wen Jiabao said he was very moved when he saw Peter Mandelson drinking a cup of Chinese milk on Friday to show his trust in China-made products. “It’s because he not only sees the present, but the future as well,” Wen said. Oh dear…

Hat-tip : Shanghaiist