Monday, January 04, 2010

Informant Followup: Russia Cuts Oil To Belarus

President of Belarus Alexander LukashenkoImage via Wikipedia
Russian frustration on agreeing energy prizes with former Soviet satraps just never seems to end.  In the last post, the Informant told you of talks between Russia and Belarus -- Moscow's fading loyal ally under thug-cum-president Alexander Lukashenko -- deadlocked over what price Minsk would pay for Russian oil deliveries in 2010.  With winter energy cutoffs from Russia become almost habit-forming, Moscow assured all that energy would flow even if the negotiations dragged on.  Now, it seems something may have got lost in translation.  In a sign of further deteriorating ties, Moscow has cut oil deliveries to Belarus, but says black gold will gurgle on to Europe.
Who's to blame for the deadlock?

Finger-pointing abounds.

The Belarus cabinet accuses Russia of "absolutely unfounded and unacceptable," pressure.

The dispute centers on tariffs.  Russia wants Belarus to pay more. 

As a Transneft official put it succinctly, Belarus is trying to secure Russian crude duty-free.  

"They want to receive it for free, process it and then send it abroad."

As the Informant explained, Belarus uses only a bit of the oil from Russia to heat apartments and such at home.  

It has made a nice business, refining the crude and selling it on at a nice profit to customers further West, especially Poland and Germany.

Those two got caught in the cross hairs of the 2007 oil spat between Russia and Belarus.  At that time, the countries say their energy deliveries dip.

Russian officials say supplies to the West will continue, but add if there are hiccups don't look at them, blame the Belarusians.   

Oil exports to Europe continue according to Belarus state oil company Belneftekhim.

A spokeswoman for the company said the Druzhba pipeline was working normally.

Belarus itself reportedly has a week's worth of oil stockpiled.

Whether that will ease European worries is doubtful.  With temperatures dipping below zero, all are hoping this latest energy drama will end soon.

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