The Belarusian leader had dubbed it the “moment of truth” in relations between Moscow and Minsk. However, Friday’s Sochi meeting between Vladimir Putin and Alexander Lukashenko ended with a whimper rather than a scream.
There was no post-summit press conference, let alone white smoke. In the end, Putin's deputy chief of staff, Dmitry Kozak, delivered a statement that revealed Russia won't be giving oil discounts to Belarus, RT reports.
From this we can infer no progress was made. Unless, of course, there are subsequent revelations.
Fundamentally, Moscow has been subsidizing Minsk for a couple of decades. Lukashenko has used that support to keep his economy stable and maintain his hold on power. What he wants is cheap oil, so that he can sell the surplus on to other countries and use the profits to supplement the state budget.
In return, Putin demands that Belarus implement the “union state” the two countries signed up for around the turn of the century. This means the establishment of supranational bodies, including a shared ruble. Lukashenko isn't keen and even took to cozying up the US, with Secretary of State Mike Pompeo offering last weekend to deliver “100 percent” of Minsk's oil needs.
In the real world, there are a few problems with this idea, most notably the fact the US itself is importing oil from Russia. Not to mention that, if Belarus alienates Moscow, it’s unclear how it would pay its bills, given the level of economic dependence. All of these points have been repeatedly made in the Russian press.
From what Kozak said, Minsk will have to pay market prices. “If we provide discounts, we would need to introduce state regulation of the oil market, which we cannot do – we cannot constantly change the rules of the game,” he told reporters. Gas will be supplied to Belarus on 2019 terms, which amount to $127 per 1,000 cubic meters. Lukashenko had been seeking a price of $73 for that quantity.
