Medvedev Signs Protocol on Duty-free Oil Supplies to Belarus

Russian President Dmitry Medvedev signed into law on Monday a protocol on duty-free oil deliveries to Belarus after a bitter dispute between the two former Soviet neighbors, the Kremlin said.

Russia and Belarus signed in late January a package of documents, including amendments to an agreement on crude oil deliveries to Belarus, to end a month-long standoff that raised concerns over potential supply cuts to Belarus and the European Union.

Under the new deals, Minsk will receive 6.3 million tons of oil duty-free this year, but the volume could increase later in accordance with the country's economic growth. The two sides also agreed to raise the tariffs for oil in transit by 11 percent this year.

Belarus imported about 20 million tons of Russian oil last year at only 35.6 percent of the crude export duty. The transit country consumes about 6.3 million tons of the Russian oil with the rest processed and pumped to the West.

Belarus sought a similar discount for 2010 but failed to strike a new agreement with Russia before the previous accord expired at the end of last December.

Russia had disputes with ex-Soviet republics over energy prices in recent years. The West accuses Russia of using its vast resources as a political tool, while Moscow says it simply wants to bring energy prices and transit rates to market levels.


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