Russia Insists Full Gas Debt With Belarus Must Be Settled

February 11, 2017, Written by

Moscow Plays Hardball With Minsk


Russia insists full gas debt with Belarus must be settled

Moscow continues to insist that Minsk settle the full gas debt owed to Russia and will not accept any partial payments. The Kremlin seems to be backing up this demand with restrictions on food imports from Belarus as well as a reduction in tax free oil supplies to the Union State member. Russia has also instituted border controls with Belarus to show it is serious about the issue.

This is a significant and growing diplomatic row between the two nations that make up the ‘Union State’ put in place after the fall of the Soviet Union. Moscow is angry with Belarusian efforts to move closer to the European Union and has also made demands that President Lukashenko allow a permanent Russian air base on his soil. The disagreement between friends is spilling out into the open.

“Negotiations continue, the process still continues,” he said. “We consider various calculations, figures, options. Generally speaking, we consider the long-term relations’ approaches. With unconditional acknowledgement the overdue payments for the past year should be settled,” said Russian energy minister Alexander Novak during a recent meeting of the two nations deputy prime ministers.

Russia says Belarus is in arrears approximately $550 million. Belarus and Russia have been negotiating a reduction in gas prices since early 2016. Minsk insisted on lowering the price of Russian natural gas from $132 to $73 per 1,000 cubic meters and demanded that Russia switch to equal netback pricing. In response to underpayment of around $300 mln for Russian gas supplies Moscow cut its tax-free oil supplies to Belarus by more than a third, reported Russian state news agency TASS.