A bitter energy dispute jeopardised oil supplies to western Europe today as Belarus struck out at neighbouring Russia by cutting off a vital transit pipeline crossing Belarusssian territory. The closure of the 2,500-mile Druzhba pipeline (druzhba means “friendship” in Belarussian), one of Europe’s biggest, meant no Russian oil was being pumped along it to Germany, Poland or Ukraine.

The European Union demanded an “urgent and detailed” explanation from Moscow and Minsk, although it said there was no immediate concern over energy supplies because of large reserves in the affected countries.

However, the dispute yet again raised fears in the EU about its growing reliance on energy supplies from Russia.

Russia accused Belarus of illegally siphoning oil from the Druzhba that was destined for German and Polish consumers. The stoppage appeared to be temporary. Belarus’s foreign ministry said a delegation was on its way to Moscow for negotiations. The row has unsettled international energy markets.

In televised comments, Russia’s deputy trade minister, Andrei Sharonov, said the alleged diversion meant it would have to stop supplies through the pipeline. “Now there is a threat to the fulfilment of international contracts between Russian companies and companies in western Europe and eastern Europe,” he said.

Moscow and Minsk are locked in a dispute over oil duties, which has now turned into open enmity, days after Belarus grudgingly accepted a last-minute deal over the doubling in price of its natural gas supplies from Russia this year.

Russia is keen to prevent Belarus, traditionally one of its closest allies in the former Soviet Union, from re-exporting petroleum products made from processing cheap supplies of Russian oil. It recently imposed an export duty of $180 (£93) a tonne on oil sold to Belarus.

Belarus countered that move last week, announcing it would charge an import duty of $45 a tonne on Russian oil shipped to western Europe across its territory. Today’s pipeline stoppage appeared to be a retaliation after Russia refused to pay that shipment tax.

The dispute echoes the “gas war” between Russia and Ukraine last year, although that conflict had a more overtly political component because raised prices reflected Moscow’s displeasure with Kiev’s turn towards the EU and Nato in the wake of the orange revolution in 2004.

Losing patience

Belarus’s hardline leader, Alexander Lukashenko, has been close to the Russian president, Vladimir Putin, and the two countries have a loose political union. But Moscow seems to have lost patience with propping up Mr Lukashenko’s creaking Soviet-style economy.

The Russian gas monopoly, Gazprom, raised gas prices for Belarus from $47 per 1,000 cubic metres to $100 on December 31. Moscow appeared furious at Minsk’s attempt to strike back yesterday and show its ability to disrupt oil supplies to Europe.

Simon Vainshtok, head of the Russian state pipeline operator Transneft, claimed Belarus had been siphoning off Russian oil from the Druzhba pipeline since the weekend.

“On January 6 the Belarussian side, without warning anyone, unilaterally started illegally siphoning off oil from the Druzhba pipeline designed solely for the transportation of oil to consumers in western Europe,” he said.

Mr Vainshtok said Belarus had diverted 79,000 tonnes of oil so far, obliging Russia to seek alternative routes for supplies to European consumers.

The dispute is likely to raise fresh fears that Europe is over-reliant on Russian energy.

“This shows us once again that arguments among various countries of the former Soviet Union … mean that these deliveries are unreliable,” said Piotr Naimski, Poland’s deputy economy minister.
Tom Parfitt and agencies
Monday January 8, 2007
Guardian Unlimited