BELARUS NEWS AND ANALYSIS

DATE:

27/01/2010

Russia, Belarus sign deal ending oil dispute: official

MOSCOW - Russia and Belarus on Wednesday signed a new deal on Russian oil deliveries to Belarus, Russian Deputy Prime Minister Igor Sechin said, ending a month-long dispute that had raised fears European supplies could be threatened.

"Today a large number of documents have been signed," Sechin told Russian President Dmitry Medvedev at a meeting, in comments published on the government web site.

Sechin said the documents signed involved changes to previous agreements on the delivery of crude oil to Belarus and the method of setting prices for the sale of Russian oil.

Sechin said he and his Belarussian counterpart had also signed a joint declaration pledging uninterrupted transit of Russian oil across Belarus to third countries.

"The Russian and the Belarussian sides guarantee stable conditions of oil transit across the territory of the Russian Federation and Belarus," the countries said in the joint declaration, Itar-Tass reported.

Sechin said that Russia agreed to compromise on "harsh" conditions because of the special relationship between the neighbouring Slavic countries.

"The position of the Belarussian side was very harsh for us. We agreed to a number of compromises, bearing in mind the special relationship with a brother republic, with the people of Belarus," Sechin said.

Sechin called the signed documents "very balanced" and "representing a compromise."

In televised comments to Sechin, Medvedev said the Russian position was to "give our Belarussian partners the opportunity to work by providing delivery for internal use at a reduced price and on the other side to guarantee transit."

Belarus reached an agreement that its tariffs for oil in transit would increase by 11 percent, Belarussian Deputy Prime Minister Vladimir Semashko said in a Belarus Belta news agency report.

In addition, Belarus will this year receive 6.3 million tons of oil duty-free for internal use, rather than a proposed 5.0 million tons, Semashko told journalists, Interfax reported.

Semashko called the terms of the agreements "quite close to those that were in force in 2009," adding that Belarus's "budget losses will not be as high as was envisaged very recently."

Sechin is expected to travel to Belarus next week to discuss development of the two countries' energy ties, Interfax reported, citing Belarussian television reports.

Russia and Belarus have been at loggerheads since December in a dispute over customs duties that raised fears of cuts in oil supplies to the European Union. Belarus is almost completely dependent on Russian oil imports.

Belarus -- which earns income from refining and reselling Russian crude oil -- opposed a Russian customs duty on oil that went into effect on New Year's Day.

Similar disagreements between Russia and neighbours Belarus and Ukraine -- both former Soviet republics -- regularly threaten Europe's energy supplies.

In January 2007, a dispute between Moscow and Minsk led to the brief closure of a pipeline through Belarus which carries around a third of Russia's total oil exports to Europe.

--AFP

Source:

http://www.malaysianmirror.com/businessdetail/9-business/28015


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