Russia’s Gazprom are to cut off gas to Belarus, in a row over unpaid bills. According to Gazprom, Belarus are more than $450 million behind in payments, and so they are left with no choice but to cut supplies by 45% from Friday (August 3rd).
As this cutoff seems to be related to Belarus’ reluctance, or inability to pay its bills, rather than a direct political crisis, I don’t really have a problem with this. Business is business.
I’m more worried about whether this will impact on supplies to downstream customers. Approximately 20% of all the gas that Gazprom supplies to EU countries goes through Belarus.
According to Gazprom, plans are in place to ensure supplies:
Gazprom spokesman Ilya Kochevrin said: “Should Belarus start illegal offtake of gas, we have a concrete plan so customers get their gas. If they do that, we will go to court and increase supplies via alternative [routes].”
I will be impressed if Gazprom manage to pull this off without compromising the supplies to their other customers.
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James 08.02.07 at 7:52 pm
(Andy - there’s a small typo in the headline).
For a long time Gazprom has been trying to figure a way bypass Belarus with its oil and gas deliveries to Europe - and this dispute is just part of that process. The real pity here, all politics aside, is that it is regular Belarusian citizens who will likely have to shoulder the burden of the reduced gas flow - as though they didn’t have it bad enough already.
Andy 08.02.07 at 8:31 pm
Thanks James - fixed.
I think the problem for Gazprom isn’t so much Belarus by itsef. More that pretty much every pipeline route to its major European markets goes through an ex-Soviet or ex-Warsaw Pact state that is either not well disposed towards Russia, or is as stable as a drunk on a pogo stick. Or both.
James 08.02.07 at 9:58 pm
True enough - but let’s remember that Belarus is/was about as friendly with Russia as any country could be - but that friendship no longer excuses them from having to pay higher rates for their gas (although by Western standards their gas deal is still ridiculously cheap).
A drunk on a pogo stick? I’ll have to try that sometime. I assume you are referring to the Ukraine? I don’t think things in Kiev are as unstable they appear.
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