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№ 1 (January 2007)

Transneft President Responds to Tariff Increase

Belarus’ decision to increase transit tariff for Russian oil by 30% is a “minor raise” for Semyon Vainshtok’s Transneft, yet a major setback to Russian-Belorussian relations. “We’re talking about an additional expense of $50 mil per year,” said Vainshtok on the Russian TV channel NTV. “This isn’t that much considering that this is the first time the tariffs have been raised since 1996.”

By Sergei Balashov

According to RIA Novosti, the tariff charged by Gomeltransneft Druzhba to transport oil along the Unecha – Mozyr – Adamova Zastava route, used to move oil to Germany and Poland, is increasing by 35% to $3.5/t. On the Unecha – Mozyr – Brody route, heading to the Czech Republic, Slovakia and Hungary, the increase is 31.6% to $1.5/t (not including VAT), in accordance with a resolution of the Belarusian economics ministry effective on February 15th, thus making the average tariff to transport oil through Belarus $0.6/t over 100 km, or an additional 30%. Transneft was informed of the ministry’s decision and given an opportunity to study the new tariffs. The company agreed to the change by signing the agreement.   

The Belarusian economics ministry argued its position with the necessity of recompensing the expenses of transporting oil, which were driven up by the increase in energy prices for Belarus. Oilru.com reports that the Belarusian President Alexander Lukashenko said the new prices would strip the republic of about $3.5 billion more than last year. "We have to ask Russia to pay for the soil under the pipelines, transporting their oil and other services on the basis of international legislation," he asserted. 

Belarus attempted to set up a $45/t fee for Russian oil transported through the territory of the republic in January. However, Transneft refused to pay the fee, forcing Belarus to siphon oil out of the pipeline, thus provoking Russia to respond by cutting off its supplies to Europe, which caused a major energy crisis. The fee was revoked only after direct negotiations between Russian President Vladimir Putin and Alexander Lukashenko, allowing Russia to resume exports to Europe. Russia also lowered the crude export duty for Belarus from $180.7/t to just $53/t. Despite the crisis having been resolved, the two countries have apparently been drifting apart from each other politically as well as economically. The latest move of Belarus strengthened this trend even more, cementing the desire of the two countries to switch to market-based economic relations. 

The Moscow Interbank Currency Exchange responded well to the increase of Transneft’s expenses, as the company’s stock grew by 0.8 percent.

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