On Russia-Belarus gas issue

Given long-standing bilateral relations and Gazprom's 50-percent stake at Beltransgaz, an array of agreements on step-by-step shift to market prices was clinched between Russia and Belarus in 2006-2007.Nevertheless, all these gas accords were based on a formula-leaning approach, which stipulates introducing a price formula with the decreasing discount. This was a cornerstone of Gazprom's policies with respect to Belarus, which has repeatedly referred to "gas blackmail" when negotiating the re-conclusion of short-term gas contracts. Belarus unilaterally failing to stick to contract obligations can hardly be justified by a spate of economic woes Minsk is currently grappling with.

Words pay no debts

Belarus artificially created the situation, which saw Gazprom face the necessity of paying to Minsk in terms of gas transit fees. The Belarusian side has repeatedly refused to sign a sheaf of documents on the matter, with Gazprom signaling its readiness to repay the 192-million-dollar-debt as soon as possible. Belarus has contested a price hike on Russian gas supplies implemented at the beginning of the year and has continued paying at last year's price, standing at 150 dollars per 1,000 cubic meters, rather than at the current contract price of 184 dollars. In the third quarter, the price may increase to at least 193 dollars, analysts warn.

Integration or disintegration?

Earlier, Russian Prime Minister Vladimir Putin said that as of January 1, 2011, Russian customers will pay for gas in accordance with a 55-percent discount in terms of what European customers pay for the fuel. As for Belarus' attempts to position itself as a Russian region, they hold no water, analysts say, pointing to the fact that the Moscow-Minsk integration is yet to be developed.Any interstate relations should be based on mutually advantageous principles of transparency. The Customs Union of Russia, Belarus and Kazakhstan is a step in right direction - something that aims to create a sustained economic structure on post-Soviet space. But without repaying old debts, it is hardly possible to start mending faces. Some experts believe that the Belarusian side is deliberately dragging its feet on talks to this effect so as to begin to pay for gas according new tariffs. Minsk's foot-dragging on the issue is almost certain to have a negative impact on a Union State of Russia and Belarus, as well the three-way Customs Union.

Minsk and Kiev differ

Analysts argue that the Moscow-Minsk gas spat will soon show signs of abating, which was not the case with a gas squabble between Moscow and Kiev in 2008. Beltransgaz is less flexible than Ukraine's Naftogaz, which is powerful enough to re-distribute resources inside the gas transportation system. Experts specifically point to the fact that Belarus' gas transit supplies are mainly implemented through the Yamal-Europe gas pipeline, owned by Gazprom. Meanwhile, the Russian gas giant has indicated intent to increase its transit supplies to Poland via Ukrainian territory.

Pre-election campaign

With the presidential elections in Belarus on the horizon, President Lukashenko deliberately starts to contribute to a chill in ties between Moscow and Minsk by notably trying to make the Belarusian public figures perceive Russia as an external enemy. Lukashenko clearly attempts to capitalize on a gas spat with Russia in a bid to resolve an array of domestic economic problems. Any potential breakthroughs on the matter will be touted by the Belarusian side as a diplomatic feat, which, in turn, will help Lukashenko preserve "the status quo." Pundits point to similar drive by Ukraine's Yulia Timoshenko and Viktor Yushchenko, who earlier decided to start "a small victorious war" with Russia - something that added significantly to tarnishing their political image.


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