Russia halts oil supplies to Belarus in bid to coerce close ties

MINSK, Belarus — Russia has halted oil supplies to Belarus as talks on strengthening economic ties remained stalled over concerns that Russia could effectively swallow up its neighbor.

In a case that has echoes of Russia’s relationship with Ukraine before it annexed the Crimean Peninsula, Belarus’ state-owned oil company said Friday that Moscow has stopped supplying crude until contracts for this year are drawn up. Belarus’ two main refineries were operating at low capacity, running on reserves.

Russian oil company Transneft confirmed the suspension, which does not affect oil transit to Europe or the supply of natural gas.

Later on Friday, Belarus suspended its oil exports, which contribute up to 20% of annual GDP. State-owned oil company Belneftekhim said there were enough reserves to cover the country’s needs.

Belarus relies on Russia for more than 80% of its overall energy needs, including gas. Over 90% of its crude oil imports come from Russia. And it has been has been relying on discounted prices and loans from Russia for more than a quarter century.

But it has one point of leverage: Russia depends on Belarus to ship oil to wealthier markets in the rest of Europe. About 10% of Western Europe’s oil supplies come from Russia via a pipeline transiting Belarus.

The Kremlin has recently increased pressure on its ally, raising energy prices and cutting subsidies. It argues that Belarus should accept closer economic integration if it wants to continue receiving energy resources at Russia’s domestic prices.

Russian President Vladimir Putin and Belarusian President Alexander Lukashenko held two rounds of talks in December, but failed to reach an agreement on deeper integration and on oil and gas prices.

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