BELARUS NEWS AND ANALYSIS
DATE:
11/01/2011
Calm in Moscow, Minsk over Belarus oil halt, tariffs
By Vladimir Soldatkin and Andrei Makhovsky
MOSCOW/MINSK, Jan 11 (Reuters) - A halt in Russian oil sales to Belarus and a rise in the tariff charged by Minsk on Russian oil transit to Europe cast a new pall on their often tense relationship, but both sides hastened to say the problems were technical.
Russian oil flows across Belarus via the Druzhba pipeline to European customers in Germany and Poland were unaffected, trade sources said.
Relations between the two ex-Soviet states have been strained in recent months and analysts have warned that the re-election last month of Belarussian President Alexander Lukashenko could lead to a more assertive stance from Minsk.
Russian oil flows to Belarus refineries -- source of key export revenue for the Communist country -- have been halted while price talks continue with Russian oil companies, refinery operator Belneftekhim said on Tuesday.
That followed Monday's announcement by the Belarussian Economy Ministry that the tariff would rise from Feb. 1 due to "changes in the economic conditions of oil deliveries to Russia." [ID:nLDE7091RL]
Transneft (TRNF_p.RTS: Quote) spokesman Igor Dyomin told Reuters the two issues were unconnected. He said the state-controlled oil pipeline monopoly had agreed to the 12.5 percent increase in transit tariffs.
"The increase in price was agreed with the Belarussian side at the end of December," Transneft spokesman Igor Dyomin told Reuters. "We agreed to this increase because in Belarus there was a sharp increase in the cost of electricity."
Rows over prices and transit tariffs between Moscow and its neighbours, Belarus and Ukraine, have led to Russian oil and gas supply stoppages to Europe in the past.
Around 40 million tonnes (about 800,000 barrels per day) of Russian oil is pumped annually to Europe via Belarus.
Low gas and oil prices from Moscow are crucial for Lukashenko's efforts to keep the ailing economy afloat.
Minsk has asked Russia not increase gas prices for 2011 to $210-$220 per 1,000 cubic metres, as Moscow had indicated it would. Belarus currently pays just over $190 per 1,000 cubic metres compared with $308 for Europe on average.
A dispute with Minsk over transit tariffs and gas payments triggered a four-day standoff between Russia and Belarus and resulted in a cut in gas supplies to Poland and Lithuania in summer 2010.
The two Slavic countries in December agreed on oil supplies after creating a free-trade zone between Russia, Belarus and Kazakhstan.
The agreement set out the terms for the transit of Russian oil across Belarus, but did not deal with the issue of gas sales to Belarus, which enjoys the cheapest gas of any ex-Soviet state. [ID:nLDE6B81I2]
"At the government level, the corresponding agreements have been signed. Price talks with Russian suppliers are under way," a spokeswoman for the Belarus state refinery operator Belneftekhim, Maria Kostyuchenko, said.
"We think deliveries will begin in January," she added, saying that the country's two refineries, with a total capacity of 360,000 barrels per day, could keep running on current stocks until the end of January. (Reporting by Andrei Makhovsky in Minsk and Vladimir Soldatkin and Gleb Gorodyankin in Moscow; writing by Melissa Akin; editing by Jessica Bachman and Keiron Henderson)
Source:
http://af.reuters.com/article/energyOilNews/idAFLDE70A0LA20110111
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