Belarus seeks temporary gas discount from Russia

The issue was discussed at the meeting of Russia’s Deputy Prime Minister Arkady Dvorkovich with Deputy Chairman of the Council of Ministers of Belarus Vladimir Semashko March 2, according to Kommersant newspaper citing two of its sources. The same topic was also raised at the meeting of the Ministry of Energy of the two states – Alexander Novak and Vladimir Potupchik.

Read alsoTurkish companies threaten to sue Gazprom over alleged gas supplies cutAccording to the source of the publication, Minsk demands that Moscow grant a $25 discount to the base price of 1,000 cubic meters of gas. As explained by the publication, the present base for the price calculation formula is the gas cost in the Yamal-Nenets Autonomous District, where the Gazprom’s wholesale price is the lowest in the country – RUB 2,395 rubles per 1,000 cubic meters excluding VAT. According to Kommersant, a discounted basis for the calculation would be three times lower than the average cost of production in Russia.

According to another source, it is about providing a $25 discount to the final price. As explained by the publication, since 2008, the price for Belarus has been calculated each quarter based on price indices for gas oil and fuel oil. In 2013, it was confirmed by an intergovernmental agreement. Now the price is $142.4 per 1,000 cubic meters.

As the newspaper notes, Belarus enjoys Gazprom’s lowest export price of gas. If the average price of delivery to the Russian domestic market is adopted as equally profitable, then the gas price for Belarus will fall to $50 per 1,000 cubic meters excluding transportation.