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Economy
21 January 2020, 15:46

Belarus-Russia oil talks in progress

MINSK, 21 January (BelTA) – Belarus and Russia are still in talks on oil supplies, Chairman of the Belarusian state petrochemical concern Belneftekhim Andrei Rybakov told the media on 21 January, BelTA has learned.

“Consultations between companies are underway. So are certain consultations at the level of the Ministry of Energy of the Russian Federation and the Belneftekhim concern. Naturally, we expect these talks to proceed at the higher level,” the concern chief said.

“It is too early to talk about any time line. I hope it will happen in the near future,” Andrei Rybakov said.

When asked whether oil from alternative sources will make economic sense compared to potentially possible supplies from the Russian Federation, Andrei Rybakov said: “There is a good proverb saying that one should not keep all eggs in one basket. Economic sense has many aspects. You lose something, but you gain something else, in the end it is the positive net result that matters.”

“As far as the price is concerned, today the customs duty on the Russian oil is substantial and accounts for a large part of the price for the Urals blend. At the same time we are fully aware of the fact that the tax maneuver will zero it out in a couple of years and by 1 January 2024 subsidies in the form of the customs duty will be brought to naught. In other words, the prices for the Urals oil will approach the world's average,” the concern chief added.

In his words, the Belarusian head of state has recently hosted a meeting on oil-related matters. During this meeting the president heard out a report on major trends on the global market of oil and petroleum products, the role and place of Belarus and its oil refineries on the market, the efforts to diversify oil supplies and find alternative sources and supply channels of oil, progress in the oil talks with Russia, as well as plans to improve the efficiency of Belarusian oil refineries through optimizing their operation and sales of petroleum products abroad.

“We were instructed to keep working towards all these goals. A lot of work is ahead in the next two or three years,” Andrei Rybakov said.

A reminder, the Belarusian head of state hosted a government conference on 21 January to discuss ways to make the export of oil products more effective. During this meeting Aleksandr Lukashenko said: “Indeed, there is no complete alternative to Russian oil now. But we have to diversify [imports] as we've agreed. We have to take steps and get 30-40% of oil from the Russian Federation. We should import about 30% from the Baltic states and about 30% via Ukraine – it's been tried and tested. Kazakhstan may supply oil to us if Russia agrees to it. It is odd that our ally refuses to allow another ally of ours to supply oil to us. Well, this is the oil supply situation we have to deal with at present.”

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