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Belarus surrenders, Russian oil flows into Europe again

Belarus is agreeing to Moscow?s terms for ending the 3-day old oil war between the two post-Soviet states, reports Fred Weir.

india Updated: Jan 11, 2007 23:11 IST
Fred Weir
Fred Weir

Russia opened the taps and crude started flowing to European customers through the Druzhba pipeline on Thursday, after Belarus backed down and agreed to all Moscow’s terms for ending the 3-day old oil war between the two post-Soviet states.

The deal struck between President Vladimir Putin and Belarussian leader Alexander Lukashenko calls for Belarus to drop its controversial $45 tax on Russian oil exports and compensate Moscow for nearly 80,000 tonnes of oil it 'illegally' siphoned from the Druzhba pipeline during the showdown.

Experts say the outcome represents 'full victory' for the Kremlin in its efforts to end energy subsidies and force Belarus to accept full market relations with Russia.

The standoff began after Belarus was compelled to accept a doubling of gas prices and an end to duty-free oil imports from Russia on New Year’s Eve. 

Lukashenko retaliated by imposing the special tax on Russian oil flowing through the Druzhba, the world’s longest pipeline, which carries crude from Siberia to Western Europe.

Russia refused to pay the tax and closed down the pipeline, leading to downstream shortages and political jitters in Europe.

Experts say the brevity of the shutdown - just 3 days - plus a wave of unseasonably warm weather in Europe, which brought down energy consumption, means that the crisis may be quickly forgotten by Western Europe, which depends on Russia for a third of its energy supplies.

Belarus, an industrial nation of 10-million, has relied heavily on cheap Russian energy and favoured market access to keep its economy running.

The new hard line from Moscow suggests that Putin’s patience with Lukashenko may be running out.

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