Russia oil row hits Europe supply

[genmirajborgza786]

Russia oil row hits Europe supply

A gas price row triggered the dispute between the two countries
Russian oil supplies to Poland, Germany and Ukraine have been cut amid a trade row between Belarus and Moscow.
Transneft's Druzhba pipeline were completely shut down at Poland's border with Belarus, Polish officials said.

The European Commission said the cuts posed no immediate risk to European supplies but it was seeking an urgent explanation from Belarus and Russia.

Exports were halted after Belarus began legal action against Russia for failure to pay a new oil shipment tax.

Transneft later said it had been forced to cut off supplies through the Druzhba pipeline after Belarus began siphoning off oil as payment in kind for the duties.

The Russian firm has so far refused to pay the oil export taxes as it claims the charges are illegal.

Stockpile concerns

The European Commission confirmed the supplies through the Polish part of the pipeline had been cut, adding it was investigating whether the move would have an impact on the other branch of the pipeline that goes to Slovakia and south-east Europe.

"I have also contacted our Russian and Belarusian authorities calling on them to provide an urgent and detailed explanation of the causes of this disruption," said European Energy Commissioner Andris Piebalgs.

Commission officials plan to look at whether European Union members will have to draw on strategic stockpiles to ensure their supplies, he added.

Poland's deputy economy minister Piotr Nalmski said his country had enough oil reserves for 80 days, but he attacked the decision to halt exports.

"This shows us once again that arguments among various countries of the former Soviet Union, between suppliers and transit countries, mean that these deliveries are unreliable," he told the BBC.

Meanwhile, German economy minister Michael Glos said he viewed the pipeline closure with concern and called on Russia and Belarus to meet their energy transit and delivery responsibilities "as soon as possible".

Officials in Minsk declined to comment on the situation, saying all questions should be directed to Transneft.

Row intensifies

The decision to shut down the Druzhba pipeline is the latest twist in an energy row between Belarus and Moscow which began when Russian energy giant Gazprom forced Belarus to accept a huge increase in the price of Russian gas.

Last week Belarus said it would charge Russia $45 (£23) per tonne of oil that passed through its country.

News of the disruption to supplies was a key factor helping to drive oil prices through the $57-a-barrel barrier after falling to around the $55 level last week.

US light sweet crude rose 89 cents to $57.20 in New York trade, while in the UK Brent crude stood at $56.71 - up $1.08.

News that Saudi Arabia, the world's largest oil producer, planned to cut output by 158,000 barrels a day also helped to drive crude prices higher.
source:BBC

 

[genmirajborgza786]

Putin firm on EU energy charter

Mr Putin said Russia had not started the tensions with Georgia
Russian President Vladimir Putin has resisted EU calls to sign an existing international treaty on investment and trade in energy.
But says he thinks Russia and the EU can agree binding rules.

They begin talks on a new strategic partnership in the next few weeks, and Mr Putin says he is confident it would be possible to find common approaches.

At an EU summit in Finland, Mr Putin also hit out at Georgian leaders, accusing them of building up forces.

The EU has been trying for years to get Russia to sign the Energy Charter Treaty without success.

It now wants to enshrine many of the treaty's principles into the new framework agreement with Russia.

Trade partnership

The aim is to make it easier for European companies to invest in the Russian energy sector, and to use Russian pipelines to export the oil and gas they produce.

The pact would also be designed to ensure that Russia treated all European countries equally, and to lay the basis for a long-term trade partnership.

Russia supplies a quarter of the oil and gas consumed in the EU, and the proportion is set to rise sharply in coming decades.

I am quite confident that we will be in a position to develop common approaches

Vladimir Putin

Mr Putin suggested that Russia could agree to most of the charter's principles when negotiations begin.

"We are not against the principles that are included in the charter, but we believe that that certain provisions of the charter should be defined better," he said.

"I am quite confident that we will be in a position to develop common approaches."

Mr Putin echoed European leaders by saying that energy co-operation needed to be rooted in the principles of predictability of energy markets and the mutual interdependence of suppliers and consumers.

'Reciprocity'

The BBC's Jonny Dymond in Lahti says Mr Putin was on a charm offensive, but there was no sign of progress on any of the really difficult issues.

European Commission President Jose Manuel Barroso said the two sides needed to develop mutual trust.

"That requires transparency, the rule of law, reciprocity, non-discrimination, market opening and market access," he said.




Europe diary: The gas man
Origin of Europe's gas
Tug of war over supply

The EU wants European investors to have the same access to the Russian energy market as Russian companies have to Europe's market, and the ability to use Russian pipelines to export any gas and oil they produce in Russia.

European governments have recently raised concerns about the treatment of some European energy investors attempting to develop oil and gas resources in Russia.

Energy security became a major priority for the EU after Russia briefly cut off gas to Ukraine in January, in a dispute over payment.

A paper prepared for the summit by the European Commission stressed the importance of increasing energy imports from the Mediterranean, Black Sea, Caspian, Middle East and Gulf regions.

'Bloodshed'

The EU leaders said before the summit that they would make clear their hopes that Russia would be able to find the killer of the murdered journalist, Anna Politkovskaya.

On Georgia, Mr Putin said that Russia had not started the latest round of tensions between the two countries.

"The issue does not lie between Russia and Georgia, the issue is between Georgia and South Ossetia and Abkhazia," he said, referring to Georgia's two Russian-backed breakaway territories.

He accused Georgian leaders of seeking to take control of the regions by military force, and said a Georgian military build-up was the cause of the latest trouble.

The Georgian government reacted angrily to Mr Putin's comments, calling an immediate press conference.
source:BBC

 

[genmirajborgza786]

Russian gas to Europe 'blocked'

Russian gas giant Gazprom says Ukraine has blocked gas deliveries to Europe, dashing hopes of ending a row which has hit several countries' supplies.

Gazprom deputy head Alexander Medvedev said Ukraine had failed to carry the gas onwards to Europe after it resumed pumping it across their border.

Ukrainian President Viktor Yushchenko called on Russia to "stop the blackmail" and work out an agreement.

Hundreds of thousands of Europeans have been without gas for nearly a week.

Moscow has been unable to resolve differences with Ukraine over debts and pricing.


The BBC's Rupert Wingfield-Hayes, at a pumping station on the Russian-Ukrainian border, says the latest twist in the dispute is symptomatic of the total lack of trust between the two countries.

'Limited' supply

European Commission president Jose Manuel Barroso telephoned Russian Prime Minister Vladimir Putin to express disappointment at the low levels of gas flowing from Russia and at the apparent lack of access to dispatch centres for EU monitors, EU officials said.

Mr Barroso said he would also discuss the problem with the Ukrainian leadership.

Russia shut off the gas to Europe last Wednesday, accusing Kiev of stealing gas meant for other European customers.


Ukraine's domestic supply was cut a week earlier.
However, in a deal reached on Monday, Russia agreed to resume supplies if Russian and EU observers were allowed to monitor their transit through Ukraine.

The move was designed to calm Russian fears that Ukraine was siphoning off gas for its own use.

Russia said gas started flowing from the Russian pumping station at Sudzha at 1030 local time (0730 GMT) on Tuesday.

This was later confirmed by EU monitors, although the amount of gas, they said, was "very limited".

Mr Medvedev said Gazprom had informed the European Commission it was unable to supply gas through Ukraine because Kiev had not opened any export pipelines.

"Ukraine didn't open the route for gas transit," he said.

"If the system is closed, we can't provide gas. The Ukrainian side cynically informed us that the gas transport system had been reoriented to domestic consumers.

"We don't know what to do at the moment."

After the gas was switched on at Sudzha, Ukrainian gas company Naftogaz demanded "the immediate resumption of even supply of gas along all transit routes", saying the amount and direction of the gas had not been agreed by the two sides.

Mr Yushchenko, speaking in a televised press conference later on Tuesday, said: "Each person living in Ukraine should understand that what has happened between 1 January and now is not the blackmail of our state, it is the blackmail of each of you."

He went on: "What is most important in these talks now is to bring a halt to the political emotions, stop the blackmail and let experts start working out answers [for transit and supply contracts]."

Major shortages

Russia cut gas supplies to Ukraine on New Year's Day, saying it would pump only enough for customers further down the pipeline.

But then Moscow accused Ukraine of siphoning off gas intended for third countries and it restricted supplies even further.

Ukraine denied the claim, but the flow of Russian gas ceased completely on 7 January, leaving many European countries with major shortages.

The EU gets a quarter of its gas supplies from Russia - 80% of which passes through Ukraine - and more than 15 countries across central Europe have been hit by the shutdown of Russian supplies.





Have you been affected by this dispute? You can send us your experiences using the form below:


Name
Your E-mail address
Town & Country
Phone number (optional):
Comments

Story from BBC NEWS:
BBC NEWS | Europe | Russian gas to Europe 'blocked'

Published: 2009/01/13 16:25:13 GMT

© BBC MMIX

Print Sponsor