Updated at 14:13,22-06-2018

Our time running out: Belarus should find alternative to Russian oil expert


We want nothing except for preserving our own schools of oil production! Alyaksandr Lukashenka offered Tatarstans president Rustam Minnikhanov close cooperation in the oil and gas industry. Of course, on mutually beneficial terms.

Our production volumes are falling. Back in the day, oil was drained and taken away from Belarus. Therefore, we would like our company to work with you. Trust me, working with us will be much cheaper than cooperation with other companies, Lukashenka asked.

Is low price always good?

Despite the fact that deliveries of Russian oil is the cheapest and still the most profitable option for Belarus, the authorities keep looking for opportunities to at least partially diversify energy supplies in Venezuela, in Azerbaijan and Iran. Although none of the projects has become an alternative to the cooperation with our eastern neighbors, Belarus should not give up, energy expert Tatsiana Manyonak says. According to her, Minsk is running out of time for maneuver.

Russia is conducting a tax reform in the oil industry. It is likely that from 2018 onwards (or a bit later) Russia will cancel duties on oil and oil products and raise domestic taxes, the expert believes.

These step might result in Belarus paying the world price for Russian oil in a few years. Having lost cheap fuel and customs revenues to the budget, our country will have to look for other energy suppliers. At the same time, Russian subsidies will be re-echoing for long: domestic refinery is not modernized enough to successfully compete on the international market.

Lukashenkas wishful thinking

This is a very big defeat and crying shame for the Belarusian authorities over these years they have not managed to find any other sources of energy supplies and establish new partnerships, political analyst Vital Tsyhankou said.

Moreover, whether Tatarstan will take Alyaksandr Lukashenkas offer remains unclear considering that the republic is a constituent entity of the Russian Federation.