Expert: Reducing Russian Oil Transit Volume Questions Blarus' Budget Replenishing From Russian Oil Re-Export

Minsk may seriously lose profits due to oil disputes.

A possible reduction in volumes of oil and oil-products transited through Belarus, as well as an increase in the transit rate, question the preserving of the scheme, when Belarus gets export duties from re-exporting Russian oil. Igor Yushkov, the leading analyst of the National Energy Security Foundation of the Russian Federation, expressed such an opinion, officelife.media writes.

Moscow's logic may be as follows: transit reduces – oil re-export revenue declines. Therefore, the parties should look for a more constructive way to return to the table of "oil" negotiations.

He reminded that the Belarusian budget received about $ 520.5 million from re-export of 6 million tons of oil in 2017, and $ 770.9 million in 2018.

According to Yushkov, increasing the tariff for pumping oil by 23% will make oil supply via the Druzhba pipeline less attractive. That is, Minsk may lose transit volumes, and with them its geo-economic importance.

The expert also reminded that the planned increase in the Belarus' tariff by 7.6% took place on February 1, 2019 and now the issue will be discussed at the level of authorized departments (FAS from the Russian side).

Igor Yushkov believes that if the tax maneuver is completed without an agreement on compensation from the Russian Federation, profitability of Belarusian refineries will decrease. Even if Belarusian enterprises process all of their own oil, they will have to buy about 16.4 million tons of Russian oil at world prices.