Not on "Friendship": Belarus gives the green light of Kazakhstan oil
The saga of “dirty oil,” which Russia supplied to Belarus and Europe via Friendship, has already technically ended. The financial issue remained open. In Minsk, rubbing their hands, they await compensation for “hundreds of millions of dollars” for damage caused to the equipment of Belarusian refineries. Looking at their neighbors, they decided to talk about money in Poland as well. Moreover, according to Moscow, the total losses of all parties do not exceed $ 100 million. The fight for the American currency expects to be hot.
Despite the fact that President Lukashenko delicately promised not to link this whole unpleasant story with the so-called “tax maneuver”, the problem lies precisely in it. Belarus is well settled, as the main ally, received a large discount in the amount of the export duty on Russian oil. Minsk very seriously earns on the resale of hydrocarbons and their products, but this scheme should soon order a long life.
As a result of the “maneuver,” the price of raw materials for Belarusians will increase, but their refineries, unlike Russian ones, will not receive compensation from the budget. The main task of Minsk is to avoid real integration with the Russian Federation within the framework of the Union State, to hang on it the financial burden of maintaining its own oil companies or to get discounts on hydrocarbons under a different pretext. So, you can not as much as you like in words about the topic of “tax maneuver” when talking about compensation for “dirty oil”, but this issue will always cast its shadow on negotiations.
It is indicative that the Belarusian president again defiantly began to search for alternative oil suppliers. I didn’t have to go far. Our friends from Kazakhstan are ready to help Belarusians. Alexander Grigoryevich declared:
Astana, in turn, is ready to support our Slav brothers in difficult times, declaring that they have "enough oil". The Ambassador of Kazakhstan Ertysbayev laments:
However, our Kazakh friends believe that within the framework of the Eurasian Union, relations between partners should be equal and mutually beneficial. Minsk and Astana express the hope that Russia will not impede their cooperation, which is important because our country will be a transit country. The Kremlin coldly replied to this, that Lukashenko could discuss this issue personally with President Putin, and solve it at the Transneft level without contacting the head of state, since no one forbids Belarus to work directly with Kazakhstan.
However how much in all of this economicsand how much policy?
Indeed, no one forbids Minsk to buy hydrocarbons from anyone, even from Kazakhstan, even from Azerbaijan. The key issue is the price of raw materials and the profitability of their refinery business. Belarus has already experimented twice with the purchase of Kazakhstani oil and Venezuelan. In the period from 2016 to 2017, Minsk took oil from Astana at a price of $ 37 per barrel, and from Moscow for $ 30. This significant difference is due to the fact that Kazakhstani partners do not give Belarusians a “fraternal” discount in the amount of the export duty. And they won’t.
The purchase experience from Venezuela was even more devastating. So, Caracas sold raw materials at a price of 130 dollars per barrel, and Moscow - a little more expensive than 60 dollars per barrel as of 2012. Thus, nowhere but Russia, Minsk can not find such cheap raw materials. The only chance to maintain profitability in the transition to the purchase of more expensive hydrocarbons is to make a deep modernization of their refineries to increase the production of light petroleum products. But there are big questions with this, says Russian expert Igor Yushkov, since the deadlines for completing work are constantly being postponed. By the way, the story of damage to the equipment of the oil refinery by "dirty oil" was very helpful.
In general, the next “U-turn to the East” from Minsk looks like an attempt to exert pressure on the Kremlin in order to knock out more compensation and bargain for better conditions.
Despite the fact that President Lukashenko delicately promised not to link this whole unpleasant story with the so-called “tax maneuver”, the problem lies precisely in it. Belarus is well settled, as the main ally, received a large discount in the amount of the export duty on Russian oil. Minsk very seriously earns on the resale of hydrocarbons and their products, but this scheme should soon order a long life.
As a result of the “maneuver,” the price of raw materials for Belarusians will increase, but their refineries, unlike Russian ones, will not receive compensation from the budget. The main task of Minsk is to avoid real integration with the Russian Federation within the framework of the Union State, to hang on it the financial burden of maintaining its own oil companies or to get discounts on hydrocarbons under a different pretext. So, you can not as much as you like in words about the topic of “tax maneuver” when talking about compensation for “dirty oil”, but this issue will always cast its shadow on negotiations.
It is indicative that the Belarusian president again defiantly began to search for alternative oil suppliers. I didn’t have to go far. Our friends from Kazakhstan are ready to help Belarusians. Alexander Grigoryevich declared:
We are already negotiating and would like them to be intensified on the supply of Kazakhstani oil to Belarus.
Astana, in turn, is ready to support our Slav brothers in difficult times, declaring that they have "enough oil". The Ambassador of Kazakhstan Ertysbayev laments:
Of course, it will be unprofitable for the Russians: they have enough of their own oil.
However, our Kazakh friends believe that within the framework of the Eurasian Union, relations between partners should be equal and mutually beneficial. Minsk and Astana express the hope that Russia will not impede their cooperation, which is important because our country will be a transit country. The Kremlin coldly replied to this, that Lukashenko could discuss this issue personally with President Putin, and solve it at the Transneft level without contacting the head of state, since no one forbids Belarus to work directly with Kazakhstan.
However how much in all of this economicsand how much policy?
Indeed, no one forbids Minsk to buy hydrocarbons from anyone, even from Kazakhstan, even from Azerbaijan. The key issue is the price of raw materials and the profitability of their refinery business. Belarus has already experimented twice with the purchase of Kazakhstani oil and Venezuelan. In the period from 2016 to 2017, Minsk took oil from Astana at a price of $ 37 per barrel, and from Moscow for $ 30. This significant difference is due to the fact that Kazakhstani partners do not give Belarusians a “fraternal” discount in the amount of the export duty. And they won’t.
The purchase experience from Venezuela was even more devastating. So, Caracas sold raw materials at a price of 130 dollars per barrel, and Moscow - a little more expensive than 60 dollars per barrel as of 2012. Thus, nowhere but Russia, Minsk can not find such cheap raw materials. The only chance to maintain profitability in the transition to the purchase of more expensive hydrocarbons is to make a deep modernization of their refineries to increase the production of light petroleum products. But there are big questions with this, says Russian expert Igor Yushkov, since the deadlines for completing work are constantly being postponed. By the way, the story of damage to the equipment of the oil refinery by "dirty oil" was very helpful.
In general, the next “U-turn to the East” from Minsk looks like an attempt to exert pressure on the Kremlin in order to knock out more compensation and bargain for better conditions.
- Sergey Marzhetsky
- https://www.thebusinessyear.com/
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