Moscow and Minsk have agreed about the price of gas

Moscow and Minsk have agreed about the price of gas

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Russia is still not ready to write off Belarus’s debts


Photo: RIA Novosti/Alexander Astafyev

Beginning in January 2016, the gas conflict between Moscow and Minsk are still not resolved. On the eve of talks with Russian President Vladimir Putin and the head of Belarus Alexander Lukashenko to be held April 3 in St. Petersburg, Prime Minister Dmitry Medvedev met with his Belarusian counterpart Andrei Kobyakov. However, the parties failed to agree owing to the unwillingness of Minsk to extinguish the accumulated debt. This was stated by Minister of energy Alexander Novak following the results of negotiations.

Since the beginning of last year, Belarus is negotiating with Russia on reducing gas prices. The Republic insisted on $73 per 1 thousand cubic meters of Russian gas instead of $132. In response to the shortfall in Belarus about $300 million for the delivered Russian gas in the second half of 2016 has reduced the supply of duty-free oil to a planned 24 million tonnes to 18 million tonnes in 2017 the debt for Russian gas had exceeded $700 million.

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Following the meeting, Russian Prime Minister expressed hope that there would be “some sense”.

— It’s no secret that the current visit comes ahead of the meeting between the presidents of the two countries. Got a lot of questions. A significant portion of these issues are also well known and has long been on the agenda. First of all, cooperation in the fuel and energy complex. Yet, unfortunately, failed this subject to allow — said Dmitry Medvedev.

In turn, the Belarusian Prime Minister expressed the hope that some questions will be able to withdraw up to the summit of heads of state. However, that’s exactly what he said last year before the same meeting of the two presidents, but the situation has not fundamentally changed.

— There are a number of issues that require discussion, and we hope that the agenda of the meeting of heads of States we will be able though a little to unload. There is an opportunity once again to discuss the most difficult, but at the same time, important questions. Now is the time to take additional measures that would allow to get back to the level of trade and economic cooperation, which was a few years ago, said Kobyakov.

In March Prime Minister of Belarus at the meeting of heads of governments of Eurasian economic community declared that problems in relations between Minsk and Moscow fundamentally affect his country’s participation in multilateral integration processes. Andrei Kobyakov said that Belarus expresses extreme concern over the continuing unresolved problems in the oil and gas sector and compliance with bilateral integration agreements in matters of energy supply, as well as “inaction against this background, the Eurasian economic Commission”.

Then Dmitry Medvedev drew attention to the fact that the countries of the Union, which is trying to block integration processes, should be aware of preferential gas prices. Them they have received through membership in the Union, said the head of the Russian Cabinet of Ministers.

Here no one forcibly holds replied to the attacks of their Belarusian counterparts Dmitry Medvedev at the meeting of heads of governments of the EurAsEC in Bishkek.

Then the Russian Prime Minister compared with blackmail attempts to make the integration within the Eurasian economic community held hostage to disagreements.

Russia is the main supplier of oil and gas to Belarus. Last year the Belarusian side was supplied 18.4 million tonnes of oil and 18.6 billion cubic meters of gas. In January–December 2016 Russia supplied to Belarus crude oil for $3.6 billion the Average price per ton was $215.

The price of Russian gas for Belarus from January 1, 2013 is calculated based on the gas price for the Yamal-Nenets region with the subsequent annual indexation in accordance with the Russian-Belarusian intergovernmental agreement (about $150 for 1 thousand cubic). Cost volumes of gas supplies to the Belarusian side in the past year have reduced compared to 2015 by 7%, to $2.5 billion of Average price per 1 thousand cubic meters of gas reached $136,6, which is 5.3% below the cost in 2015.

Moscow provides Minsk with large-scale financial assistance. Currently, there are eight intergovernmental agreements on granting of Belarus Russian loans totaling more than $15 billion at the beginning of year the debt of the Republic on them is $6.2 billion with accrued interest (on the order of 60 billion roubles).

See also:

The first batch of Iranian oil arrived in Belarus

Moscow is interested in Uzbek gas

On the edge of the energy divide: the challenges of Russian-Ukrainian relations in the energy sector

Minsk: decisions on the Russian gas depend on the political will