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Gazprom to cut Belarus supplies

2007-08-01 08:02:49

Gazprom, Russia's state-owned gas monopoly, has said it will almost halve supplies to neighbouring Belarus because of a $500m ( 247m) unpaid bill.

In a repeat of supply disputes with former Soviet republics in 2005 and 2006, Gazprom says Minsk has failed to pay in full for previous shipments.

While 20% of Gazprom's European exports pass through Belarus, the firm said supplies to Europe should not be hit.

Moscow denies accusations that it uses gas supplies to bully its neighbours.

Instead, it insists that price rises last year for Belarus, Ukraine and Georgia merely reflect the end of Soviet-era subsidies.

'Strict accordance'

Gazprom's decision to cut supplies to Belarus by 45% from 3 August comes after Belarus missed a 23 July deadline to pay the $500m.

"Gazprom will take all possible measures for the transportation of Russian gas through the territory of Belarus in full accordance with current obligations before European customers," it said in a statement.

"We are acting in strict accordance with our contract," added Gazprom spokesman Sergei Kuprianov.

Belarus' energy ministry said it was continuing talks with Gazprom to try to resolve the situation.

At the end of 2006, Belarus was within minutes of seeing its gas supplies cut when it agreed to start paying $100 per 1,000 cubic metres, compared with a previous price of $47.

Ukraine was also forced to start paying more for its Russian gas in 2006, but not before Gazprom reduced its supplies, leading to a knock-on reduction in gas passing through the country to western Europe.

This dispute sparked concern within European Union nations about their energy security and the future reliably of Russian gas, which now accounts for much of European requirements.