Minsk offerings – Kommersant newspaper No. 166 (7367) of 09/09/2022

As Kommersant has learned, the Russian Federation can provide support to Belarus by increasing the import of Belarusian fuel, which has been minimal in recent years. The meaning of the measure is to help the Belarusian oil refining industry against the backdrop of EU sanctions and the loss of the Ukrainian market. Now the Russian authorities are discussing how to provide Belarusian refineries with a damper, since without these payments, deliveries to the Russian Federation will be unprofitable for them. If the damper extends to the entire volume of Belarus’ former exports to Ukraine, the amount of support could amount to more than 60 billion rubles. in year.

The Ministry of Energy and the Ministry of Finance of the Russian Federation are actively discussing the import of gasoline and diesel fuel from Belarus, several sources in the industry tell Kommersant. According to two Kommersant sources, Russia decided to expand supplies from Belarus in the face of problems with sales of Belarusian refineries, which worsened after the cessation of fuel exports to Ukraine against the backdrop of Russian military operations in this country. The main goal of the measures being discussed is to support Belarusian oil refining and the country’s budget revenues under sanctions, Kommersant’s sources say. According to Argus, Belarus provided 45% of total gasoline imports to Ukraine and 37% of diesel fuel imports – 1.04 million tons and 2.97 million tons, respectively.

The problem is that Russian refineries receive significant subsidies for supplying fuel to the domestic market – the so-called damper, while Belarusian refineries are now not eligible to receive it. Deliveries to the Russian Federation without a damper will be unprofitable for Belarusian refineries, so now such operations are almost never carried out. The Russian authorities are currently discussing how it would be possible to pay the damper to Belarusian factories, while there is no decision. The Ministry of Energy of Belarus forwarded questions to Belneftekhim, where they declined to comment. The Ministry of Finance of the Russian Federation did the same. The Ministry of Energy did not answer Kommersant.

According to one of Kommersant’s interlocutors, the Ministry of Finance may prepare changes to the Tax Code without specifying which payment mechanism will be used. According to Kommersant’s interlocutors in the industry, the option of obtaining a damper by Belarus with the help of a trading company registered in the Russian Federation can be studied. Now Belneftekhim supplies products to the Russian Federation through the Russian LLC Belneftekhim-ROS. But, according to lawyers, various options are possible.

Thus, Kirill Nikitin, head of the directorate of Vegas Lex law firm, considers it more likely to conclude an interstate agreement with Belarus or adopt relevant regulatory legal acts at the presidential or government level. He reminds that earlier an agreement was reached between Moscow and Minsk to compensate the Belarusian side for losses in connection with the tax maneuver in the oil industry of the Russian Federation by reducing premiums to the price of oil supplied to Belarus by Russian oil companies.

Significant problems with Belarusian exports to Europe began after the US and EU imposed sanctions against Belarusian refineries last year after the incident with the landing of a Ryanair plane at Minsk airport, and in June 2022, the EU tightened sanctions against the Novopolotsk refinery. In April of this year, the government of Belarus stated that due to sanctions, the loading of the Mozyr and Novopolotsk refineries had already halved, to about 14 thousand and 12 thousand tons of oil per day.

In recent years, fuel supplies to Russia from Belarus have been minimal. The only exception was 2020, notes Maria Arie from Petromarket: then in Russia the damper took negative values ​​(oil companies had to pay to the budget), but this did not concern Belarusian refineries, which allowed them to increase gasoline exports to Russia 20 times (up to 152.1 thousand tons) and resume supplies of diesel fuel (179.4 thousand tons).

The expert considers it possible to expand the effect of the damper to Belarusian refineries. According to Ms. Arie, based on the September damper (5.43 thousand rubles per ton for gasoline and 19.53 thousand rubles per ton for diesel fuel), with deliveries at the level of 2020, Belarusian plants can receive 4.4 billion rubles. , and with export volumes at the level of maximum historical levels (2013-2014), payments could exceed 13 billion rubles. If the task is to redirect to Russia the entire volume of fuel that Belarus previously supplied to Ukraine, then the volume of the damper will already amount to 5.5 billion rubles. for gasoline and 58 billion rubles. for diesel fuel.

However, the expert doubts that the Russian market is able to digest such large-scale supplies – for diesel fuel, they can account for about 7.5% of all domestic consumption in the Russian Federation. At the same time, Maria Arie recalls, Belarusian refineries will not be full-fledged beneficiaries of payments, since they will be forced to reduce prices for end consumers by the amount of subsidies received.

Dmitry Kozlov, Tatyana Dyatel