* Moscow bet on Trump to improve battered ties
* But Trump has backed sanctions, boxed in on Russia
* Deteriorations in ties revives talk of new Cold War
* Short of options, Russia will court others
MOSCOW, April 4 (Reuters) - Russia long saw Donald Trump as the wild card in its strategy to improve relations with the United States.
But 14 months after he became U.S. president, Moscow is close to viewing him as a busted flush, unable to enact his pledge for better ties.
Trump reluctantly signed off on new sanctions against Moscow last summer over allegations of Russian meddling in the 2016 U.S. presidential election. Last week he backed the expulsion of 60 Russian diplomats and the closure of Russia's Seattle consulate over the poisoning of an ex-Russian agent in Britain.
After betting the farm on Trump, Russia has seen relations with the West sink so low that there is talk of a new Cold War. President Vladimir Putin's options for a change of strategy, banking less on Trump and his ability to sway those around him on Russia, is severely limited as he prepares for a new term.
One option being explored is to try to widen splits in the West by courting France and Germany. Another is to draw closer to China and India. But the relationship with Washington is still seen in Moscow as central to Russian foreign policy.
"Washington has become fixated with the fight against a non-existent, so-called Russian threat," Sergei Naryshkin, Russia's foreign intelligence agency chief, said on Wednesday.
"This has reached such proportions and acquired such absurd characteristics that it's possible to speak of a return to the dark times of the Cold War."
Russian Foreign Minister Sergei Lavrov said earlier this week that the standoff was worse than during the Cold War between East and West after World War Two.
"...Then some kind of rules and appearances were kept up. Now, as I see it, our Western partners ... have cast aside all proprieties," Lavrov said.
The Cold War saw the Soviet Union square off against the United States, with the threat of nuclear war hanging over the world until the collapse of the Soviet Union in 1991.
But the standoff was kept under control by arms treaties, superpower summits and both proscribed and informal rules of engagement.
The new standoff, raw and unpredictable, has been likened to a "fight without rules" by Konstantin Kosachev, head of the upper house of Russian parliament's foreign affairs committee.
The risk of miscommunication, miscalculation and sudden escalation into a hot war is higher than during the original Cold War, he says.
Trump's appointment of Mike Pompeo and John Bolton, whom Moscow regards as arch Russia hawks, to key foreign policy posts last month has further soured the mood in Moscow, say analysts and people close to Russian decision makers.
When it comes to the United States, these sources say Moscow is not willing to change course, make concessions or launch new initiatives.
Russia will therefore continue to engage only if and when the United States is ready to do so, and, if faced with more hostile action - such as further diplomatic expulsions - will respond in kind, the people close to decision makers say.
"All we can do is keep the doors open for negotiation and wait and see what will happen. That's the predominant view," said Andrey Kortunov, head of a think-tank close to the Russian Foreign Ministry.
In particular, Moscow is keeping the door open to a possible summit between Trump and Putin, an idea floated by Trump, and is also keen for U.S.-Russia talks on strategic nuclear stability to avoid a costly arms race.
But its baseline scenario is a downward spiral in ties.
"Washington is the standard bearer of a new Cold War," Fyodor Lukyanov, a foreign policy expert close to the Kremlin, wrote in government daily Rossiyskaya Gazeta after last week's U.S. diplomatic expulsions.
"There's no point in hoping for an improvement in ties or any progress in any area for the foreseeable future," said Lukyanov, who has warned the Russian elite to brace for sweeping Iran-style financial sanctions.
EASTWARDS, FRANCO-GERMAN PIVOT
While better ties with the United States are seen as a remote possibility, improved relations with France and Germany are seen as "more interesting opportunities for political investment," said Kortunov.
Kremlin spokesman Dmitry Peskov praised France's "constructive position" after Paris confirmed French President Emmanuel Macron would still visit Russia in May despite tensions. Alexei Pushkov, a senator specialising in foreign policy, has lauded German Chancellor Angela Merkel's decision to back Russia's proposed Nord Stream 2 gas pipeline.
The planned pipeline will connect Germany and Russia, despite concerns from other EU nations who fear it will harm the bloc's energy security.
Lukyanov said Moscow should look to beef up ties with Beijing and Delhi as they had "freedom to manoeuvre" on the world stage and were not vulnerable to Western pressure on Russia.
Moscow believes the only wild card it has with Washington is Trump who, in Russian eyes, appears to have been playing a game of good cop bad cop, offering Russia a glimmer of hope, while Congress and his administration read Russia the riot act.
Russia casts Trump as a hostage of the U.S. political establishment who it accuses of reducing his room for manoeuvre by boxing him in with the special investigation into his associates' possible collusion with Moscow and what Russia says are false allegations it meddled in U.S. politics.
Its disappointment with Trump has unfolded in stages.
Trumps decision to launch a missile strike against a Syrian air base, drop a large bomb in Afghanistan in an attack on Islamic militants and stick with Obama-era policies over Russia's annexation of the Crimea region from Ukraine, and, until recently, his tough talk on North Korea, went down badly in Moscow.
And initial euphoria over his victory gave way to dismay last summer when the man they hoped would end U.S. sanctions reluctantly reinforced the penalties.
His decision to back the expulsion of 60 Russian diplomats over the Skripal affair was a new inflection point.
"Increasingly, diplomacy is becoming irrelevant in Russian-U.S. relations," Dmitri Trenin, a former colonel in the Russian army and director of the Carnegie Moscow Center, said of the move.
"It seems to be the time to hit/retaliate/prepare for a fight."
Trump's approval of the expulsions was seen as a bad omen for his relationship with Putin by an online Russian newspaper viewed as close to the Russian presidential administration.
"If 14 months after taking office Trump has not won himself freedom of manoeuvre, it's very hard to count on him getting it in what's left of his presidential time," wrote Vzglyad.
Trump's congratulatory phone call to Putin after the Russian leader's re-election, his talk of a U.S.-Russia summit in the same call, and his statement on Tuesday saying it would be "a great thing" if he had a "very good relationship" with Putin have provided small shards of hope to Moscow.
"In theory, one can imagine that if President Trump somehow clears himself of the allegations of collusion with Russia .. he might get out of the cage and exercise a little bit more autonomy in rebuilding this relationship," said Kortunov, the think-tank head close to the Foreign Ministry.
"But these hopes are very slim."
(Editing by Timothy Heritage)