Russia, Belarus clinch oil supply deals: deputy PM

10:18, January 28, 2010      

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Russia and Belarus on Wednesday signed a package of documents on oil supplies to Belarus, Russian Deputy Prime Minister Igor Sechin said, ending a month-long dispute between the two former Soviet neighbors.

The documents include "amendments to an agreement on crude oil deliveries to Belarus, oil pricing procedure, and a joint statement on oil transit guarantees," Sechin was quoted by Russian news agencies as saying at a meeting with President Dmitry Medvedev.

Sechin said the documents ensured the interests of Russian companies.

He said both he and his Belarusian counterpart pledged uninterrupted transit of Russian oil via Belarus to third countries in their joint statement.

Sechin added the two countries had agreed to revise oil delivery volumes this autumn if necessary.

"There is a possibility of adjusting the volumes. We agreed to check consumption volumes and tariff calculations additionally in September," he said.

Belarusian Deputy Prime Minister Vladimir Semashko said the tariffs for oil in transit would grow by 11 percent, Belarusian state news agency BelTA reported.

Semashko said Russia would supply Belurus with 6.3 million tons of duty-free oil this year.

"We succeeded in proving that Belarus' domestic demand for oil amounts to 6.3 million tons a year instead of a proposed 5 million tons," Interfax quoted him as saying.

Semashko said the new deals gave permission for increased duty- free deliveries at the end of the year.

By Oct. 1 the quota of duty-free supplies will be raised proportionately to the actual growth of the Belarusian economy, he said. The Belarusian government predicted the country's gross domestic product would expand 11-13 percent this year.

Belarus imported about 20 million metric tons of Russian oil last year at only 35.6 percent of the current crude export duty, which stands at 267 U.S. dollars per metric ton as of Jan. 1. The transit country consumes about a quarter of the Russian oil deliveries with the rest processed and pumped to the West.

Belarus sought a similar discount for 2010 but failed to strike a new agreement with Russia before the previous accord expired at the end of December.

Russia earlier offered to continue "preferential" terms this year, which allow Belarus to buy 6 million tons of crude for domestic consumption without tariffs but demand full import duties on some 14.5 million tons of oil bound for European markets.

Belarus insisted all Russian crude should be duty-free, citing an agreement on customs union signed late last year.

The standoff raised concerns over potential supply cuts to Belarus and the European Union over the past month.

Source: Xinhua
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