Belarusian Oil Market to Become a Battlefield for Russian Companies Soon it will become clear, who is going to get the best piece of the pie

By Vladimir Shlychkov, November 18, 2013

October without giving any reason – the author’s note), we are still holding negotiations,” Semashko announced.

Belneftekhim press service announced that it had reached the agreement with Rosneft “on joint coordinated work in the area of oil supply to Belarusian refineries by the end of 2013 and in 2014.” The volumes were not specified, though.

According to sources close to the Belarusian government, the negotiations on 2014 oil supply are still underway. Notably, Minsk intends to import as much as 24 million tons. This record-setting volume was established with the consideration for new refinery processing units commissioned in 2013, as well as the plans for modernization of Belarusian oil refineries in 2014.

The situation should get more clear in quite a short time. Belarus perfectly understands, that the transition to cooperation with a monopolist supplier of energy resources can have quite negative consequences. One may assume, that Rosneft’s share in the Belarusian oil market is going to increase steadily, but gradually. After all, even if the leading company gains control over “just” half of crude oil supply, its volume might amount to approximately 12 million tons. In this case, Minsk will faced (or, perhaps, has already faced) quite a challenging dilemma: how to gain maximum profit from the relations with Rosneft, the Kremlin’s favorite, and at the same time retain partnerships with other Russian companies, which traditionally supply crude to Belarus.

Let’s assume that Rosneft has become the sole supplier of oil to Minsk. How can it affect the Belarusian oil refining industry? Vitaly Pavlov, Mozyr Oil Refinery deputy general director, gave a quite diplomatic answer: “It’s hard to comment on the events that haven’t taken place yet. I can only say, that we know this company as an experienced and reliable partner having immense resource.”