Negotiations Fail: Russian to Supply 18mln Tones Oil to Belarus, Not Demanded 23mln

“Representatives of the Russian government handed Siamashka proposals that provided for the supply of 18 million tons to Belarus the following year,” the source said, noting that the Belarusian delegation was leaving for Minsk on Tuesday.

Siamashka claimed on Friday that Russia did not mind supplying 23 million tons of crude to Belarus in 2013.

“We agreed that 23 million tons would be supplied in 2013 and we heard no objections,” he said.

Siamashka confirmed that Russia had increased the amount of oil to be supplied to Belarus in the fourth quarter of 2012. According to him, the director general of the Mazyr oil refinery reported to him over the phone that the refinery had increased the daily refining rate to 32,000 tons from 22,000 tons in October.

Siamashka also said that Belarus was ready to supply Russia with petroleum products in 2013 if this was profitable. The Belarusian refineries’ exports currently have a profit of $20 to $25 per ton, he noted. “This level of profit is minimal and can only finance their modernization,” he added.

Belarus agrees to supply Russia with high octane gasoline unless this is unprofitable, Siamashka noted. According to him, Belarus has made such supplies in the last two weeks, but the supply of diesel fuel continue to be unprofitable, with the refineries losing $60 to $80 per ton. “If we continue these supplies, we’ll go bankrupt,” he said.

Under the Russian energy ministry’s directive, AK Transneft earlier reduced the amount of crude oil to be supplied to Belarus in the fourth quarter of the year by 26 percent to four million tons in response to Belarus’ failure to fulfill its obligations regarding the supply of petroleum products to Russia.

Belarus and Russia agreed in late 2011 that a total of $21.5 million tons of Russian crude would be supplied by pipeline to Belarus in 2012 – 3.5 million tons more than in 2011 – with the possibility of supplying up to three million tons more by rail. Belarus made a commitment to supply Russia with 5.8 million tons of high-quality petroleum products in 2012, including 2.1 million tons of gasoline, 3.5 million tons of diesel fuel and 0.2 million tons of aviation kerosene, but it reportedly supplied only 144,300 tons of petroleum products in the first eight months of the year.

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