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U.S. Looks To Snag Market Share From Russia In Its Own Backyard

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The U.S. State Department has announced "the willingness of U.S. companies to begin immediately selling oil to Belarus at competitive market prices" in a clear signal to Minsk -- and neighboring Russia -- of Washington's desire to expand trade ties with the post-Soviet country of around 10 million people.

A State Department spokesman said Secretary of State Mike Pompeo had "reiterated U.S. support for Belarusian sovereignty" and "discussed the potential to increase bilateral business ties" in a March 13 phone call with Belarusian Foreign Minister Uladzimir Makei.

The announcement comes a little over a month after Pompeo made the first trip to Belarus by a sitting U.S. secretary of state since 1994 and emerged saying the United States was seeking closer ties with Minsk but did not need to choose sides between Belarus and Russia.

Belarus has spent decades being heavily reliant on Russia for cheap oil and gas as well as billions in annual subsidies to prop up its highly centralized economy.

But it has been intense talks with Moscow over oil prices for months.

Oil and gas disputes have sharpened a wider political discord between the two post-Soviet countries over forming a union that both sides pledged to in 1999.

On March 11, Belarusian Prime Minister Syarhey Rumas said the sharp drop in oil prices had opened room for Minsk to reach an agreement with Moscow over supplies.

In February, President Alyaksandr Lukashenka threatened to start tapping oil from a transit pipeline if Russia did not supply Belarus with the volumes of crude it needed.

The 4,000-kilometer-long Druzhba pipeline crosses Belarusian territory and supplies about 1 million barrels of Russian oil to Europe per day.

Druzhba oil deliveries were halted in April 2019 due to high concentrations of organic chloride found in the pipeline, a problem that caused months of friction and disputes.

Lukashenka has been in power in Belarus for more than 25 years but has faced growing pressure from Moscow to agree to deeper integration under a 1999 unification agreement, which envisaged close political, economic, and military ties but stopped short of forming a single nation.

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Leave a comment
  • Dewey Kendrick on March 14 2020 said:
    How about shutting down imports from saudi arabia? Or at least enforcing tariffs to make American crude competitive here at home. Turn the ships around, make them sit out in the gulf and rot. Now is the time to switch to becoming 100% energy independent while demand is low and supply is high. Switch our refining from processing heavy foreign crude ( high in sulfer) to light, domestic, sweet crude. Use government subsidies, tax breaks, whatever it takes, get it done. If the idiots over there (russia, saudi) want to turn on the taps, let them drown themselves into bankruptcy. You want to go to war, we'll give you a war.
  • Mamdouh Salameh on March 14 2020 said:
    A willingness by the United States to sell crude oil to Belarus will hardly register on Russia’s crude oil exports’ radar.

    Belarus imports an estimated 368,000 barrels of crude a day (b/d) which used to be supplied by Russia at discounted prices. However, Russia decided recently to demand international oil prices for any crude oil supplies.

    Oil and gas disputes have sharpened a wider political discord between the two post-Soviet countries over forming a union that both sides pledged to in 1999.

    Belarus threatened to start tapping oil from a 4,000-kilometer Druzhba oil pipeline that crosses Belarusian territory and supplies about 1 million barrels a day (mbd) of Russian oil to Europe if Russia did not supply Belarus with the volumes of crude it needed.

    However, this has a lot of risks for Belarus not dissimilar to those faced by Ukraine in its gas disputes with Russia.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

Leave a comment




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