Russia has agreed to sell crude oil to Belarus cheaply, days
after the two sides concluded a deal to resume Russia's oil flows
to Europe through Belarussian pipelines.
Russia agrees on tax reduction
After some 10 hours of tense talks in Moscow, the two sides
signed a three-year agreement on Friday, under which Russia will
cut the duty on oil exports to Belarus to 53 U.S. dollars, down
from the 180 dollars, and Belarus will share with Moscow a
substantial amount of profits from the refined oil products it
sells to Europe.
"In fact, we will for instance earn 53 dollars from every ton of
crude shipped to Belarus in 2007," Russian Prime Minister Mikhail
Fradkov was quoted as saying by Interfax after meeting with his
Belarussian counterpart Sergei Sidorsky.
The tax cut was made after Belarus agreed that it would share
with Russia a large proportion of the billions of dollars it has
made from refining cheap Russian oil and selling the value-added
products to European markets.
Russian news agencies cited Fradkov as saying that Russia would
receive 70 percent of revenues from Belarus's exports of refined
Russian oil this year and the figure would rise to 80 percent in
2008 and 85 percent in 2009.
Fradkov said that the deal would bring more than 1 billion
dollars into the Russian budget.
For his part, Sidorsky was quoted by the Itar-Tass news agency
as saying that "we have been carefully considering the rates for
the past two days and studying the possibilities of Russian
companies and crude supplies to our refineries. Naturally, the
interest must be mutual."
Sidorsky, who started a two-day negotiation in Moscow from
Thursday, said sugar deliveries was another sensitive issue to be
discussed after the dispute over oil is resolved.
In late December, Russia introduced duties on sugar imports from
Belarus, which normally sells half of its annual production of
around 770,000 tons to Russia. Belarussian officials said sugar
producers have already lost around two million dollars as a result
of this tax.
Deal seems to cap dispute
The deal seemed to cap the weeks-long dispute between the two
previously close allies over energy prices.
In the new year, Russia doubled gas export prices to Belarus and
imposed a full export rate for crude oil -- which had previously
been supplied without a duty -- of around 180 dollars per ton.
Belarus also reached a deal with the Russian gas giant Gazprom
in the last minutes of 2006, agreeing to buy Russian gas at 100
dollars per 1,000 cubic meters in 2007, more than double the 46.7
dollars it paid last year. Gazprom agreed to pay more for its gas
supplies to Europe through Belarus.
However, Belarus, a country of 10 million people, which depends
heavily on cheap energy to turn a profit, refused to accept
Moscow's imposition of a 180-dollar-per-ton export duty on all
Russian oil shipped to the country.
Earlier this month, Minsk responded by slapping the oil transit
duty of 45 dollars on Russian oil piped across its territory,
effective from Jan. 1.
On Monday, Russia, the world's second biggest oil exporter,
cutoff the flow, claiming that Belarus had siphoned off some 80,000
tons of oil as payment for the transit fee. The 60-hour shutdown
affected Germany, Poland and a host of other countries, cutting
European Union (EU) oil supplies by around 1.5 million barrels of
oil per day.
On Wednesday, after a telephone conversation between Belarussian
President Alexander Lukashenko and his Russian counterpart Vladimir
Putin, Belarus lifted the transit tax and agreed to return the oil
Moscow said it had taken illegally. Hourslater, the oil flow was
back on track.
(Xinhua News Agency January 13, 2007)
