Russia cuts off supplies of oil products to Ukraine. Belarus to grab chance?

Ukraine is a focal area for Belarus’ export of oil products. According to statistical data, the Belarusian fuel, mainly gasoline, makes for about 30% of the corresponding market in the neighbouring country. Russia achieved a dominant position in the Ukrainian diesel fuel market (50%). On April 18, it became known that Russia would soon stop supplying Ukraine with oil and oil products. Will Belarus take advantage of the situation?

“Belarus could offset that. But the question is whether and to what expent the Republic of Belarus will find appropriate reserves against the background of the allocated quota of oil supplies, the distributed amount of oil products that are being purchased by other customers. On the other hand, we should not rule out the possibility of renewing and increasing Russia’s oil shipments,” Ihar Tyshkevich, an expert at the Ukrainian Institute for the Future, believes.

Belsat TV economic commentator Stanislau Ivashkevich recalls that the Russian tax maneuver may result in the Belarusian budget’s losing over $300 mln in 2019. In this context, the Russian authorities’ recent measure against Ukraine looks like a sort of compensation for Belarus.

“The name of the game is hundreds of millions of dollars. Firstly, Ukraine is a market having premium, there fuel is more expensive than in other markets to which Belarus delivers its fuel. Secondly, since the transport leg is shorter, one can save a lot of money,” he said.

Independent experts stress that in 2019 president Alyaksandr Lukashenka has twice met with Ukrainian politician Viktor Medvedchuk, who is also known as Vladimir Putin’s crony. The latest meeting took place two weeks ago.

“He is a pro-Russian politician who completely monopolized the supplies of petroleum products from the Russian Federation to Ukraine. And Ukrainian traders resorted to Belarusian smuggling schemes to skirt Medvedchuk’s monopoly. During the two meetings, Lukashenka and Medvedchuk might have discussed the possibility of Medvedchuk’s starting to ‘work’ through Belarus – and paying add-on margin, of course,” Tyshkevich stressed.

According to the experts, such developments are prompting Belarus and Ukraine to deepen not only economic, but political cooperation as well. At the same time, they do not preclude the risks of the boost of illicit deliveries of Russian energy resources to Ukraine via Belarus as part of the existing scheme, i.e. under the guise of solvents and biofuels.

Thus, the Russian ban on exporting oil and oil products to Ukraine may give unexpected opportunities to Belarusian oil refiners, as well as to the political leadership of the both countries. Whether and what way the parties will be taking advantage of the situation – that is the question.

Belarus willing to buy oil pipeline from Putin’s crony in Ukraine

Zmitser Mitskevich/MS, Belsat TV

Photo: Aexander Ryumin / TASS / Forum

See also