FX.co ★ Russia cuts oil exports to Belarus over unpaid bill

Russia plans to cut crude oil exports to Belarus, its ex-Soviet economic partner. The decision was taken after Belarus failed to settle debt for natural gas supplies. Russia’s energy ministry insists the neighboring country owes the state-run Gazprom $125 million for supplies from January to April 2016.

"Our Belarusian partners have not been paying us in full for gas. Due to this, we are losing money, including for the budget ... Of course Gazprom, a large taxpayer, is forced to seek out options for compensation," Russia’s Energy Minister Aleksander Novak was quoted as saying by the Interfax news agency. “The original schedule of oil exports to Belarus has to be revised. Oil supplies will be cut gradually, day by day, proportionally to the volume of the debt”, the official noted.

However, Belarus suggests its own standpoint of the gas dispute. Belarus’ President Lukashenko, who was once seen as a loyal ally of Moscow, says Belarus should pay less for oil and gas if the two countries are serious about stepping up economic co-operation. Mr. Lukashenko thinks that Belarus buys Russian gas at an inflated price of $132, bidding $80 per 1,000 cubic meters. It means the debt does not exist. The Kremlin considers this price to be fair. Belarus’ President irritates Moscow by dropping his dependable loyalty to Russia in favor of closer ties with the European Union.