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Belarus ditches oil transit tax Belarus ditches oil transit tax
(about 1 hour later)
Belarus has cancelled a transit tax on oil coming from Russia, according to the country's Prime Minister. Belarus has cancelled a transit tax on oil shipments from Russia, according to the country's Prime Minister.
The move, following meetings between government ministers, marks progress in resolving an argument with Moscow over oil started earlier this week. The move, following meetings between government ministers, marks progress in resolving an argument with Moscow over oil which began earlier this week.
Russia closed the pipeline on Monday after it accused Belarus of stealing oil supplies.Russia closed the pipeline on Monday after it accused Belarus of stealing oil supplies.
Oil through the Druzhba pipeline - across Belarus - could flow soon, European customers say.Oil through the Druzhba pipeline - across Belarus - could flow soon, European customers say.
The Kremlin earlier refused to confirm the deal, but did say the two sides had spoken. The Belarusian Prime Minister, Sergei Sidorsky, said: "The government, taking into consideration bilateral agreements with the Russian government, has taken the decision to cancel the state duty for the transit of oil along the state pipeline network."
Pressure According to Transpetrol, which runs Slovakia's section of the pipeline, supplies will start later on Wednesday.
"The prime ministers of Belarus and Russia were ordered to work out concrete proposals within two days for resolution of all problem questions," a statement from President Alexander Lukashenko's office said. Criticism
His office added that the proposals needed to be submitted for review by the heads of state by Friday, 12 January. The move by Russia to cut off supplies via the Druzhba - or Friendship - pipeline - has elicited much criticism, most recently from the International Energy Agency's head Claude Mandil.
RUSSIAN OIL USERS* Hungary - 83.5% of all oil suppliesSlovakia - 82.2%Finland - 79.1%Poland - 77.2%Czech Republic - 49.3%Belgium - 31.8%Sweden - 29.4%Germany - 26.2%Netherlands - 25.3%Italy - 18.1%Austria - 16.8%France - 11.4%Denmark - 2.1% *Source: Petroleum Economist magazine Q&A: Pipeline shutdown Analysis: Oil rowRUSSIAN OIL USERS* Hungary - 83.5% of all oil suppliesSlovakia - 82.2%Finland - 79.1%Poland - 77.2%Czech Republic - 49.3%Belgium - 31.8%Sweden - 29.4%Germany - 26.2%Netherlands - 25.3%Italy - 18.1%Austria - 16.8%France - 11.4%Denmark - 2.1% *Source: Petroleum Economist magazine Q&A: Pipeline shutdown Analysis: Oil row
News of the deal followed reports that Russia had upped the pressure on Belarus to reach a deal. He said the move undermined faith in Russia as an oil exporter. "It is more difficult to be confident" Mr Mandil told the Reuters news agency.
According to news agencies, long queues of cars had formed at the Russian border with Belarus after Moscow imposed new restrictions requiring Belarusian drivers to apply for a temporary vehicle entry certificate. Mr Mandil added that if stocks in countries affected were to fall under 90 days worth the IEA would "order a coordinated stocks release".
Meanwhile, local newspapers claimed that Russia had threatened to impose duties on all Belarusian imports unless a deal was agreed. German Chancellor and current European Union president Angela Merkel had denounced the pipeline closure as unacceptable and one that "destroyed trust" in Russia as an energy supplier.
Russia's decision to shutdown the Druzhba - or Friendship - pipeline sparked consternation across Europe. Talks
German chancellor and current European Union president Angela Merkel denounced the move as unacceptable and one that "destroyed trust" in Russia as an energy supplier. Before Belarus announced it would end the transit tax, talks between Moscow and Belarus had taken place in an attempt to resolve the dispute.
Other member countries feared that oil supplies could run short as the Druzhba shutdown effectively halted shipments to Poland, Germany and beyond. Following those talks a statement from Belarus President Alexander Lukashenko's office said: "The prime ministers of Belarus and Russia were ordered to work out concrete proposals within two days for resolution of all problem questions."
His office added that suggestions made at those talks needed to be submitted for review by the heads of state by Friday, 12 January.
HistoryHistory
The dispute was sparked when Russia forced Minsk to grudgingly accept a doubling in the price of gas supplies.The dispute was sparked when Russia forced Minsk to grudgingly accept a doubling in the price of gas supplies.
In retaliation, Belarus imposed a new tax on Russian oil shipments passing through the country. Russia has refused to pay the duties, saying they are illegal.In retaliation, Belarus imposed a new tax on Russian oil shipments passing through the country. Russia has refused to pay the duties, saying they are illegal.
On Monday the conflict came to a head when Russian state-owned pipeline firm Transneft closed the Druzhba pipe, saying Belarus had been siphoning off oil supplies as payment in kind for the unpaid duties.On Monday the conflict came to a head when Russian state-owned pipeline firm Transneft closed the Druzhba pipe, saying Belarus had been siphoning off oil supplies as payment in kind for the unpaid duties.
The 2,500-mile-long pipeline has the capacity to ship more than 1.2 million barrels a day to eastern and central Europe and typically works at close to full capacity.The 2,500-mile-long pipeline has the capacity to ship more than 1.2 million barrels a day to eastern and central Europe and typically works at close to full capacity.