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Russia stands firm in gas dispute with Belarus despite threat of disruption to Europe

Russia stands firm in gas dispute with Belarus despite threat of disruption to Europe

Russia refused to back down on Wednesday in a gas price dispute with Belarus after Minsk threatened to siphon off Russian natural gas bound for Europe if Moscow cuts off deliveries to its ex-Soviet neighbor on New Year's Day.
Russian state gas monopoly OAO Gazprom has said it will halt gas supplies to Belarus unless a new contract is signed before the existing one expires Dec. 31.
But it risks a new wave of Western concern over its reliability as the key energy supplier to Europe, just one year after a similar dispute with Ukraine caused brief disruptions to Russian gas deliveries to several European countries.
Belarusian First Deputy Prime Minister Vladimir Semashko shrugged off the threat and hinted Belarus could halt supplies of Gazprom gas that is pumped through Belarus to nations including Germany, Poland and Lithuania.
"We are interconnected," he said after returning from Tuesday's unsuccessful talks with Gazprom chief Alexei Miller. "I have no contract with Mr. Miller on deliveries to Belarus from Jan. 1, and Mr. Miller has no contract on transit through Belarus."
"You can shut the pipeline, but there is enough gas for Germany and Lithuania for 12-13 days," he said, suggesting Gazprom reserves already in Europe would last only that long if Russia halts all deliveries into Belarus.
Gazprom spokesman Sergei Kupriyanov said the company, which initially said Belarus must pay US$200(euro150) per 1,000 cubic meters of gas next year but is now asking for US$105 (euro80), is not prepared to go lower.
"Such a New Year's gift should not be expected from Gazprom. Gazprom is not Santa Claus," he said in televised comments. Most Russians exchange holiday gifts on New Year, a Soviet-era tradition.
The Belarusian official claimed that Gazprom could not risk the international criticism it faced during the Ukraine gas crisis. Europe depends on Russia for a quarter of its gas consumption.
"I don't think Gazprom will resolve to cut off gas to Belarus _ they shouldn't step on the same rake twice," he said. He also said Belarus could raise transit fees if Gazprom hikes the price.
The head of Gazprom's export arm said the company would seek to ensure that European customers would not face supply shortages if Belarus hindered the transit of Russian gas.
"Like last year with Ukraine, this year with Belarus not everything depends on us. We will do everything possible to compensate for potential unsanctioned siphoning of gas," RIA-Novosti quoted Alexander Medvedev as saying.
Early in 2006, Gazprom was forced to pump additional gas to Western Europe to make up for supply shortages caused by its cutoff of gas to Ukraine, which was accused of skimming off Russian gas bound Westward.
Belarus now pays US$47 (euro36) per 1,000 cubic meters. Russia supplied gas to ex-Soviet states at below-market prices for years after the 1991 Soviet collapse, but now wants to sell all its gas at world prices.
The increased price would be a severe blow to Belarus' Soviet-style state-run industries, whose financial health _ and, in turn, a portion of Lukashenko's popularity _ depends on cheap gas.
In addition to raising the price, Russia wants Belarus to cede Gazprom a 50 percent stake in its gas distribution system, Beltransgaz.
The politically charged dispute reflects seriously strained relations between Belarus and Russia, which have the closest ties of any two ex-Soviet republics and signed a treaty in the mid 1990s to create a close union.
Russia has supported Belarus' authoritarian President Alexander Lukashenko in the face of severe Western criticism, but relations have been tense under Russian President Vladimir Putin, who angered Lukashenko a few years ago by suggesting an integration scenario under which Belarus would become little more than a Russian province.
Under Gazprom's offer of a price of US$105 in 2007, Belarus would pay US$75 (euro57) per 1,000 cubic meters in cash and US$30 (euro22) in shares of the country's gas distribution system, Beltransgaz. The price would increase annually at the same rate as prices for Russian industrial consumers, reaching a market-style European price in 2010.
Gazprom would pay for a half-share in Beltransgaz by allowing Belarus to pay US$30 per 1,000 cubic meters in shares over the next four years.


Updated : 2021-04-11 21:59 GMT+08:00