18 January 2018, Thursday, 11:06

Final countdown: Russia is ready provide even less oil


Russia is ready to ship 18 million tons of oil to Belarus on the condition that the latter ships back 2.1 million tons of oil products.

A source close to the negotiations told that to the Agency of Oil Information.

“We are ready to ship 18 million tons, maximum – 18.5 million tons, but only on the condition of shipment of 2.1 million tons of oil products in return”, - he said.

A source in the Ministry of Energy of Russia confirmed to Interfax that one of the main question of the negotiations is the volume of oil products made from Russian oil and shipped back to Russia.

“Russia need these volumes, especially the petrol part, since a number of problems could arise in the domestic market. In the meanwhile for Belarus it the western direction of oil products shipments that is more profitable. That is why there is a delay in the negotiation. The negotiations have not been finalized yet”, - he pointed out.

The agency’s interlocutor did not rule out that in the course of the session of the Council of Ministers of the Union State and the meetings at the top level in the beginning of December this issue can be put to the agenda.

Earlier the deputy Prime Minister of Russia Arkadiy Dvorkovich told journalists that Russia had not agree the volumes of oil shipments to Belarus in 2013 in the amount of 23 million tons. At the same time the first vice Prime Minister of Belarus Uladzimir Siamashka said that such agreement had been reached. Siamashka also added that in 2013 Belarus would be ready to ensure shipments of oil products to the Russian market only if such shipments were profitable.

A source, familiar with the course of the negotiations, told the Interfax agency, that “the Russia party in the course of the negotiations with Minsk justifies the possible decrease in the oil shipments to Belarus in 2013 by limited technical capabilities of Transneft and the necessity to increase the load of the Baltic pipeline system – 2 (BPS-2).

In the meanwhile, the Agency of Oil Information’s interlocutor stated that Transneft itself never spoke about limiting the pumping capabilities. In the opinion of the pipeline monopoly, it is reasonable to pump 16 million tons in the direction of Belarus coming from the principle of the final consumer oil shipment. “These are the volumes that the Belarusian refineries are capable of processing into qualitative fuel”, - he added.

The signing og the oil balance for 2013 is complicated by the rigid reaction of the Russia’s leadership on the export of solvent from Belarus, which is considered a shadow duty-free reexportation of oil products in Moscow. The Russian party thought that Belarus, having increased the volume of purchased Russian hydrocarbons, started to export petrol to the European markets disguised as solvents. The export duty on solvents is 0 in the Customs Union, whereas it is 90% of the export duty on oil. Such a scheme led to significant losses for the Russian budget, which could account around $2 billion only in 2012.