The latest Russia-Belarus row over gas prices seems to be running in deep crisis as the Russian State pipeline operator Transneft cut oil supplies to Belarus. The recent Russian move has halted oil supplies to Poland, Germany and Ukraine who were the end users of the Russian oil flowing through Belarus. Oil exports were halted after Belarus started taking legal action against Russia for failing to pay new oil shipment tariff.
Belarus has recently increased its tariff rate on the Russian oil flowing through its territory. However, Kremlin had already made it clear that Belarus cannot arbitrarily increase the tariff without consulting Russia. In the meanwhile, Transneft has stated that it had been forced to halt the supplies as Belarus had started siphoning off oil claiming as payment in kind for the increased duties. The Russian company has till date resisted paying the oil export taxes as they consider it illegal.
On the other hand, Germany and Poland are not facing any immediate threat of experiencing oil shortage as both the nations maintaining considerable oil reserve, roughly sufficient for two months. European Commission has asked Russia and Belarus to for giving explanation for the latest disruption of oil supplies. In the mean time the commission also started investigating the impact on another branch of the pipeline that runs to Slovakia and South East Europe.
Russia since last 15 years has been supply gas and oil to its former Soviet nations on a much lower rate than the market price. However, now the situation is, many of the break away nations are not friendly or rather hostile relation with Russia. In the wake these circumstance Russia rightly feels that its generosity is being abused. Russia has accused that the cheap crude it sends to Belarus is being refined there and being sold as in form of diesel and patrol at relevant market price.
Taking stock of the entire situation, the Russian move cannot be explained as illegal or unjustified.
