Putin Checks Lukashenko into the Boards

Author: Kostis Geropoulos

Alexander Lukashenko may be a good ice hockey player, but when it comes to gas games, he is no match for Vladimir Putin. The Belarusian President appeared to flex his muscles, but, given his country's heavy reliance on Russia, his toughness was short-lived, giving in to the Russian premier.

Moscow and Minsk ended a four-day "gas war" on 24 June with Gazprom spokesman Sergei Kupriyanov declaring the dispute settled, though questions remained about the rate for transit. "They have actually pretty much resolved it. Now they will try to remove the discrepancies they had in the contracts," Alfa Bank Oil & Gas Analyst Pavel Sorokin told New Europe on 25 June by phone from Moscow. It seems that the conditions for the actual pricing for both gas supply and transit have been set up in a rather controversial way, leading to speculation that in the transit contracts with Belarus the rate increase was tied to wholesale price increase in Belarus, Sorokin said.

But the timing when the mutual gas claims have appeared raises political questions given Russia's initiative of a three-way customs union with Kazakhstan. "It is a political question why the conflict has arisen right now when all the negotiations on the customs union are happening," Sorokin said.

Lukashenko called the gas crisis "an absolutely groundless dispute" for which "there was absolutely no reason," and criticized Moscow for not giving Belarus more time to pay its $200-million gas debt. Putin said Russia had repeatedly sought a resolution to the row, but Belarus remained intransigent. With each of the countries accusing the other of owing money, and each making partial payment, Gazprom resumed normal gas supplies to Belarus. It had previously reduced supply by as much as 60%. For its part, Belarus appeared to back away from its earlier threat to disrupt EU supplies unless Russia paid $260 million in transit fees.

In Brussels, EU Energy Commissioner Guenther Oettinger described the gas crisis as "an attack" on the whole of the EU. "I think the government of Belarus wants to integrate Europe in their problem, but I think it's not okay," Oettinger told a press conference with Yuriy Boyko. Ukraine's Energy Minister confirmed Kiev was, if necessary, ready to help. Sorokin told New Europe it is possible. "Now that relations with Ukraine seem to have improved significantly, Russia and Gazprom are able to divert a big portion of the supplies through Ukraine because Ukraine gas transport system is operating under capacity so unless Belorussia blocks all the transit much of the volumes can be redirected," Sorokin said.

Russia is also pushing with its Nord Stream and South Stream pipelines to diversify gas export routes away from transit countries like Ukraine and Belarus. However, Nord Stream is about establishing additional delivery routes for additional amounts, not rerouting the gas from existing routes, Sebastian Sass, head of Nord Stream's representation to the EU, told New Europe on 23 June. Having said that, the diversification of supply routes also leads to higher security of supply and is also part of the European Union's policy of diversification, Sass noted, adding: "If deliveries in one route fail, there are still sufficient routes available and that's what we provide."


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