BELARUS NEWS AND ANALYSIS

DATE:

07/01/2010

Russia says oil dispute talks with Belarus continue

MOSCOW, Jan 7 (Reuters) - Russia and Belarus were locked in a second day of talks aimed at resolving a dispute over 2010 oil supply prices, Russia's Energy Ministry said on Thursday.

Russia briefly cut oil supplies to Belarussian refineries in a dispute over pricing that raised the prospect of supply disruptions for European Union customers, and helped push U.S. crude CLc1 to the highest close in 15 months on Tuesday.

"Talks are ongoing," ministry spokeswoman Irina Yesipova said by telephone, declining further comment.

There were tensions on the first day of talks on Wednesday, with Moscow and Minsk giving conflicting accounts on the negotiations' status. [ID:nN06150609]

The Russian Energy Ministry had said talks were "constructive", but a Belarussian state-run media report said talks had broken down.

Russia allowed Belarus to import oil at just 35.6 percent of the current crude export tariff in 2009. Moscow now wants Belarus to pay full duties on the crude, which is refined into oil products and sold for export by Belarus.

Russian Prime Minister Vladimir Putin has said Belarus can buy 6 million tonnes of oil this year for domestic needs without paying duties.

But that leaves another 14.5 million tonnes of crude a year that Moscow says Belarus should pay at least the full $267 a tonne duty on, which would mean potential additional annual payments for the Belarussian economy of at least $2.5 billion.

Russia has repeatedly clashed with its neighbours over energy pricing in recent years, leading politicians from the EU and the United States to accuse Russia of using its vast energy resources to brings its neighbours to heel, though Moscow says it is simply trying to bring in market pricing.

A dispute with Ukraine last winter left EU customers without gas for almost two weeks at the height of winter, severely straining ties with the European Union.

Source:

http://uk.reuters.com/article/idUKLDE6061IV20100107


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