Rosneft Agreed with Minsk on Oil Supplies to Belarus

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Rosneft agreed with Belarus on oil supplies with a premium of five dollars per ton. Media reported with reference to the Russian company representative. Other details were not reported. Earlier on April 2, Prime Minister of Belarus Syarhey Rumas announced that Minsk expects to receive two million tons of Russian oil at a price of about four dollars per barrel. The prime minister stressed that deliveries will go without prizes to Russian companies. Belarus Ambassador to Russia Vladimir Semashko said that Minsk will not refuse alternative oil supplies, although deliveries from Russia will be carried out without premiums. President of Belarus Alexander Lukashenko, in turn, noted that he was considering possible alternative oil supplies. About 40 percent of all necessary supplies are procured in Russia, Lukashenko specified. At the end of last year, Moscow and Minsk failed to agree on oil supplies for 2020. The talks were held amid discussions on integrating the two countries in the Russian oil supply exchange at the previous price. In Belarus, protests took place. Lukashenko accused the Russian side of striving to “twist Minsk’s hands” in order to “achieve compliance.” He emphasized that he would not compromise the sovereignty of the country. The Kremlin said that Russian President Volodymyr Putin did not propose a unification of the two countries, but spoke about deepening the existing union integration. At the end of March, it became known that Russian oil companies would nullify premiums on oil supplies to Belarus. So requested by Minsk. For this purpose, the Russian government will compensate oil industry workers for $ 85 million in 2020. According to RBC, this amount is estimated at 40 percent of the Russian oil industry losses. The Prime Minister of Belarus then stated Belarus would choose oil companies that would offer the best oil supplies conditions. Rumas recalled that the priority, in particular, will be the companies of businessman Mikhail Gutseriev. In the first quarter of this year, they continued to supply Minsk with oil without a premium. Gutseriev is a friend of the Belarusian President, Alexander Lukashenko. According to RBC experts, the parties reached an agreement, primarily due to increased competition in the oil market. In early March, Russia and the OPEC countries failed to agree on additional oil production reduction amid the decrease in demand due to the coronavirus outbreak. This led to a collapse in oil prices and the fall of the ruble. In response, Saudi Arabia announced its intention to increase raw materials supply to the market by more than 25%.