The meeting in the Black Sea resort of Sochi on January 21 will be Putin's sixth with the German leader since she took office in November 2005, and comes during Germany's presidency of both the EU and the Group of Eight leading industrialized nations.
"I believe that the main topic of the discussion during the [Merkel's] visit will be energy issues, and in particular the search for a compromise on Energy Charter," said Alexander Shatilov, deputy director of the Center for Current Politics in Russia.
Russia has been unwilling to ratify the charter, which was drawn up as a cooperation mechanism between Western and Eastern Europe on energy issues and signed at The Hague in 1991, as the document would force it to give foreign investors free access to the country's oil and gas deposits and export pipelines.
"The Energy Charter, in a broad sense, will hinder the activities of Russian energy companies on European markets," Shatilov said. "It would be hard to reach a compromise on this issue."
The expert said Russia has a solid position in the energy dialogue with Europe will be able to strengthen it even further during the upcoming talks because "Russia has an enormous energy potential and it would be wrong not to use it to protect the country's political interests."
Valentin Fedorov, deputy director of the Institute of Europe, said Europe and Germany in particular will become even more dependant on Russian energy supplies in the future.
He said Germany had decided to fold its nuclear energy program in thirty years and find alternative energy sources, but the sought capacity will satisfy only 7-10% of the country's demand.
"Where they are going to get the rest [of energy supplies]? Of course, form us [Russia]," Fedorov said. "They [the Europeans] will have to stick with us."
Russian Foreign Minister Sergei Lavrov said in December last year that Russia and the European Union should use the Energy Charter as a basis for developing uniform rules of energy cooperation.
"We will not ratify the current version of the Energy Charter Treaty, but we are not against developing uniform rules for energy cooperation along the principles set down in the document," Sergei Lavrov said during a meeting with students at Moscow State University.
Moscow's refusal to ratify the Energy Charter Treaty was used by Poland as a pretext to veto talks on a new partnership agreement, which were to be launched at the Russia-EU summit in Helsinki November 24.
Lavrov said Russia-EU relations would make considerable progress without being excessively politicized.
