If it is winter and the start of the New Year, then there must be an oil dispute between Russia and one of its former republics. Last year, the Ukraine and Georgia were in Russia?s crosshairs. This year, Belarus seems to be standing up to the Russian giant. Europe is increasingly facing up to the reality that Russia will use its energy resources as an instrument of both foreign and economic power. In addition, Europe has often been caught up in energy disputes between Russia and other states because most of the pipelines run through Eastern Europe. Supplies have been cut on the Druzhba (Friendship) pipeline that runs through Belarus and that affects supplies to Poland, Germany, and Ukraine among others. While these countries have reserves, if the flow of oil takes a long time to resume, these countries could experience some serious supply issues.
The current dispute is rooted in a price war between Russia and Belarus. Russia has been raising the price of its energy resources consistently to both wealthy European customers and less wealthy former republics and satellite states. Many of the former Soviet republics feel that Russia?s price raises are tantamount to extortion. Russia has frequently cut off oil supplies. Russia or Gazprom threatened to halt supplies to Belarus if its 123% price increase was not met, Belarus has threatened to disrupt supplies to Europe. However, Belarus reluctantly agreed to the price increase, but then placed a tax on the transit through its pipelines, a move that angered Russia. It is likely that Belarus is trying to recoup its expenses from the energy increases. Russia has refused to pay the tax and has accused Belarus of stealing the oil as payment for the taxes. As a result, they cut off supply.
Thus, both Russia and Belarus are at impasse. To date, states that have tried to stand up to Russia have failed. It usually has been the case they are dependent on Russia for their energy and simply cannot hold the moral high ground. It is likely that Belarus will have to accept Russia?s energy terms or risk being cut off. While Russia does not want to lose their profitable and lucrative European market, it is likely that both Russia and Europe can hold out longer than Belarus.
