Belarus looking for alternatives to Russian oil

In particular, the head of state mentioned new taxation of the Russian oil industry. He remarked that due to this fact Belarus is forced to look for alternative oil among other things. Lukashenko noted that Belarus certainly depends on Russia in the acquisition of raw materials and hydrocarbons.

“But it is no catastrophe today. We have to deal with the so-called tax maneuver. In the past we earned money by processing Russian oil. We would buy Russian oil without paying customs duties because we have a customs union and free trade. But they insisted that we should give them some of the money if we sell resulting oil products to Ukraine and other countries. Later they saw that too much is left in Belarus' hands. They went ahead with the tax maneuver by taxing the extraction of mineral resources in Russia. There are still no customs duties impeding trade but they've introduced this tax and oil has become more expensive,” the president said.

He noted: “It means that our 2 oil refineries are now at a disadvantage in comparison with their refineries. Moreover, they now reimburse the tax on extracting mineral resources to Russian oil refineries. They don't reimburse our refineries. And oil became more expensive right away. We are being pushed towards the international price. In response I said in Petersburg last time that we will be forced to buy oil on the market.”

Lukashenko remarked that the Russian oil variety Urals is not the best oil available on the global market. Belarus has already practiced alternative oil deliveries along the Odessa-Brody oil pipeline in the past.

“During negotiations I said openly that we have 3 options, we are making calculations regarding oil deliveries to our oil refineries. Moreover, we will upgrade the refineries mostly this year. They will operate at a profit even if we buy expensive oil in the Mediterranean Sea region or the Black Sea region or the Baltic Sea region. We will buy it, process it, and will turn a profit,” the Belarusian leader said.

“But we can process 25 million tonnes of oil today. We will bring this oil to the Russian market because their sales are here. Let's say, we use Iranian, American, Saudi oil, oil from the Arab Emirates. A sheikh was here some time ago, we had talks. Does Russia want this? You will lose the market. At least 20-25 million tonnes. I am convinced Russia doesn't want it. Let's negotiate a deal! No deal so far,” added Lukashenko.

The head of state also mentioned alternative ways to deliver oil under consideration. “We've used the Odessa-Brody option. We had oil delivered by rail from Odessa. It is more expensive. It is surprising that getting oil from Gdansk – via Poland to Belarus – turned out to be the most profitable option. We could make a link and deliver oil to 2 oil refineries simultaneously. We will use 2 lines of the Druzhba oil pipeline initially. And we will use them to deliver oil in reverse mode. Not from Russia but from other places [via Poland] to us. We are not trying to pressure Russia. We are looking for alternatives. The 3rd option is getting oil via the ports of Lithuania and Latvia. And everywhere we will contribute to interests of transit countries.”

Lukashenko remarked that Ukraine is interested in deliveries of oil products – diesel fuel and gasoline. Belarus makes quality products in this regard. The modernization of the relevant plant for the deep processing of oil is nearing completion at Belarusian oil refineries. “We can process [oil]. If we are to ship via Ukraine, we are ready to involve Ukraine in the project. You need these oil products. Let's work together. Our businessmen have bought a line of [the oil pipeline] PrikarpatZapadTrans. A pilot batch of some 8,000 tonnes has already been pumped. We are ready to work on that option, too,” the head of state said.