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SEPTEMBER 2020

Russian Oil Supplies to Belarus Stopped Pending New Delivery Agreements

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Russian Oil Supplies to Belarus Stopped Pending New Delivery Agreements

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Russia has stopped supplying Belarus with oil, a spokesman for the Belarusian state concern for oil and chemistry, Belneftekhim, confirmed.

“The loading of both refineries has been reduced to a technological minimum”, the spokesman said, adding that the shortage is indeed connected to the absence of oil supplies from Russia.

The spokesman also said that the two sides were in negotiations over reaching deals in January 2020.

On the other side, Russian oil transport company, Transneft said that despite there being no request for oil supplies from Minsk, transit through Belarus is operating without any restrictions.

“We are pumping oil as part of [official] requests from oil companies. Since 1 January, we have no requests from oil companies for supplies to Belarusian oil refineries”, the company’s representative Igor Dyomin said.

Earlier, RIA reported, citing an unnamed source, that oil supplies from Russia to Belarus were stopped as of January 1st.

“There is no transportation in the direction of Belarusian oil refineries,” the source said.

According to him, oil supply ceased on January 1st, and any agreements ended on December 31st.

Nevertheless, the agency’s interlocutor added, Belarus still has oil reserves and both refineries are operating normally. In total, there are two oil refineries in Belarus – in Mozyr (Mozyr Oil Refinery OJSC) and Novopolotsk (Naftan OJSC).

At the end of December 2019, President of Belarus Alexander Lukashenko said that in 2020 the republic would buy about 22 billion cubic meters of gas and 24-25 million tons of oil from Russia, and at prices not higher than last year. Prior to this, a balance of oil supplies for 2020 was signed in the amount of 24 million tons.

However, delivery contracts were not concluded by January 1. In the last days of the year,

Lukashenko discussed this issue over telephone with Russian President Vladimir Putin, Prime Minister Dmitry Medvedev and Energy Minister Alexander Novak. In addition, he gave the instruction to provide alternative oil supplies from the Baltic ports and through the Druzhba pipeline, for which he threatened to “take away two pipes from Russia.”

According to the press secretary of the Russian president Dmitry Peskov, it was not possible to reach an agreement, but the dialogue will continue and any extreme scenarios were not going to happen.

Russia’s crude oil output is growing, as Bloomberg reported that it reached a post-Soviet Union high. In 2019, Russia extracted 560.2 million tons of crude oil, which equals 11.25 million barrels daily. These numbers are the highest since the fall of the Soviet Union and are closing in on Russia’s oil production in 1987 when the country extracted 11.416 million barrels per day.

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