Gazprom Belarus Spat Looks Set To End

By Stewart Douglas

Russian state gas authority Gazprom has announced today that supplies through Belarus could be allowed to continue after tensions between Russia and Belarus over the last few months.

Gazprom, which is run by the Russian government, supplies much of the natural gas resources through surrounding, former Soviet nations like Belarus, and is considered to be essential in providing energy to meet demand in the region.

The argument between Russia and Belarus arose over the outstanding Belarus tab, which it claimed had run into the region of $465million, unpaid and overdue.

As a consequence, Gazprom had threatened to axe supplies to the region until a satisfactory conclusion had been reached, and the full sum of the bill had been met.

News from Belarus today has indicated that it would be prepared to settle the bill, in order to allow Gazprom supplies of natural gas to continue through the territory.

Belarus had claimed that the unprecedented 100% price rises of earlier this year had resulted in cash flow problems, which would require time to meet a resolution.

The economic hostilities between the former Soviet nations have resulted in deadlock, with international diplomatic discussions over the issue.

But now, with an apparent resolution on the cards, the Russian gas authority has announced a potential road through the crisis.

The heated debate almost came to blows at the start of the year, with suggestions that Belarus was only minutes from losing its gas supply from the Russian authority.

Gazprom rose prices by more than double for supplies to Georgia, Ukraine and Belarus, from $47 to $100 per 1000 cubic metres, with what were perceived to be extortionate practices.

The situation attracted widespread attention from the EU over the security of world gas and energy supplies, particularly given the importance of Gazprom in European gas supplies.