Author: 
DMITRY ZHDANNIKOV | REUTERS
Publication Date: 
Thu, 2010-06-24 02:53

"I demand that Gazprom pay $260 million to Beltransgaz
by 10:00 (0700 GMT) tomorrow," First Deputy Prime Minister Vladimir
Semashko said.
"If it is not done we will be forced to stop providing
services for all hydrocarbon transit," he added.
The European Union said Lithuania was receiving 40 percent
less gas than usual due to the dispute while other Russian gas customers — such
as Poland and Germany — have said they have not seen a reduction in supplies
yet.
The dispute has been escalating since Monday, when Russia
announced the first round of cuts, and on Tuesday Belarussian President
Alexander Lukashenko said the two nations were facing a full-scale "gas
war".
Russia, the world's largest energy exporter, supplies Europe
with 25 percent of gas needs, with four-fifths of that flowing via Ukraine and
one-fifth via Belarus.
Russia also supplies around 1 million barrels per day of oil
to Germany and Poland via Belarus.
Ukraine has already promised to ship more Russian gas to
Europe to help Moscow plug the potential gap in supplies via Belarus, while
analysts have said the impact on consumers should not be big given low gas
consumption in Europe at the moment.
The close ties between Russia and Belarus have been
increasingly strained as Lukashenko has sought to use Russia's eagerness to
maintain an ally on its Western flank to pressure Moscow not to scrap
longstanding economic subsidies.
Belarus is to hold presidential elections next year and
Lukashenko, who has ruled the country since 1994 in what analysts describe as a
Soviet authoritarian style, has pledged to raise state wages and salaries.
Belarus pays the lowest price among Russian gas customers
and has bridled at recent increases, saying it should pay less for oil and gas
if Moscow is serious about close ties. Lukashenko has courted the West and
sought other energy sources.
Relations have soured further since Russia and Belarus
failed to agree on unified customs rules and Lukashenko gave refuge to ousted
Kyrgyz President Kurmanbek Bakiyev, despite Moscow's support for the new Kyrgyz
leadership.
Semashko said Belarus had paid all its outstanding debt to
Gazprom of $187 million for gas deliveries in January-April, which sparked the
conflict when Gazprom demanded repayment last week and began to gradually
reduce supplies to Minsk.
Earlier on Wednesday, Gazprom cut supplies to Belarus by
more than a half but said gas was flowing smoothly to Europe despite Minsk's
threats to shut down transit pipelines. Gazprom also acknowledges it owes Minsk
money for gas transit but says Belarus has effectively blocked payments.
Previous pricing disputes with Minsk led to oil supply cuts,
with Poland and Germany being affected most as they receive large volumes of
crude and gas from Russia via Belarus.
A similar standoff with Kiev halted much larger Russian gas
supplies across Ukraine for almost two weeks in January 2009, leaving many
Europeans without fuel during a bitter cold snap.
Russia and Ukraine have had two major standoffs over gas
since 2005 amid badly strained relations between the Kremlin and Ukraine's
pro-Western former President Viktor Yushchenko.
Ties have dramatically improved since Yushchenko was
replaced by Viktor Yanukovich, seen as much more loyal to Moscow. He swiftly
agreed new gas and military base deals with the Kremlin after taking power
earlier this year.

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