21 June 2021, Monday, 5:10
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Reality Hits Regime Back

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Reality Hits Regime Back
PHOTO: BELTA

The hesitation of Russian companies around Naftan creates a dangerous precedent, serving as a bad example for others.

Hello, child.

Of course, you already know about the sanctions of the Russian oil companies against Naftan. Today is April 28, and Naftan, as far as we know, does not yet have a single contract for the supply of oil for May.

When I told you that with the new mechanism for the application of US sanctions, the sanctions from the European Union are becoming somewhat redundant in a way, this is what I actually meant. Although, of course, there is some irony in the fact that Russian companies were the first to react to the US sanctions. Well, what can I say? Friendship is friendship, but nobody wants to catch a bad disease.

It is also a little ironic that it is Naftan's gasoline and diesel that are transported through the Klaipeda port. The same port from which the Belarusian authorities took part of their oil transit as part of retaliatory sanctions. Now, I think that the port itself can refuse everything else. If, of course, Naftan has anything to transport.

Naftan processes 700,000 tons of oil per month and exports about 400,000 tons of petroleum products. Replacing Russian oil for the refinery will be problematic, to put it mildly. Because Azerbaijani oil will not reach Naftan, and Norwegian oil is unlikely to go where even Russian oil wants to escape. One could try to come to an agreement with Venezuela, they certainly don't care, but they haven't paid Venezuela for the last diversification of supplies, so this is not an option. You can also send Belarusian oil to Naftan. But, firstly, this is 140,000 tons versus 700,000 that the plant needs, and secondly, then there will be no oil left to export it (50-60 million dollars a month).

The average monthly export price of refined products from the refinery is approximately $ 160 million. Export duties on petroleum products (also on potassium, of course) are currently the main source of foreign exchange for payments on external debt. (Because there is no one to intercept, and there is no abundance of currency in the country). So, with all the sympathy for Naftan, the Belarusian authorities will not worry about Naftan's problems in the first place. Because the problems of Naftan will immediately backfire with some difficulties with the reserves of the National Bank.

Of course, the Belarusian authorities will now try to come up with something. Well, you never know. Suddenly, the Russian authorities will decide to sacrifice Rosneft for the sake of an ally, to whom the world backstage is stretching its bloody tentacles. Well, they may also find some companies that will not be sorely missed by them, if given away. They, of course, will demand a hundred small services for each fed hydrocarbon vitamin (in the sense that the profit margin will be greatly reduced), but the Belarusian authorities are not in a position to be picky.

But the main problem for the Belarusian authorities is not the deprivation of Naftan of the Russian oil, not difficulties with payments on foreign currency debts, and not the reduction in the reserves of the National Bank. Here, as usual, indirect consequences are worse than direct ones, although indirect ones may not appear immediately.

The hesitation of Russian companies is setting a dangerous precedent, serving as a bad example for others. You need to understand that the Belarusian enterprises subjected to the sanctions will begin to rapidly lose customers and partners. And even if some oil supplies to Naftan resume, it may turn out that the refinery will have no one to sell its gasoline. Because in two months of this year, out of 1.7 million tons of oil products, two Belarusian factories sold 1.5 million to the EU and Ukraine. And for all the indispensability of the Belarusian industry in the structure of the world economy, I somehow think that under the threat of US sanctions, Western partners will still try to find a way to somehow replace it. So, while in the world of their illusions, the Belarusian authorities infringe on adversaries by getting rid of empty cans of Nivea, the rough reality hits back.

The “Letters to Daughter” Telegram channel