The ministers of transport of both countries have signed a take-or-pay agreement, according to which some 9.8mt of Belarusian oil products (incl. heavy fuel oil, naphta, and diesel) will be handled at Russian Baltic ports.

The deal covers the 2021-2023 period and can be extended automatically.

"Oil products can be delivered from Belarus [to Russia] by railways. However, when compared with the delivery to Klaipėda, transportation to the Leningrad Region means a considerable extension with seaborne transport to be involved. That has initially been the core problem. To make this logistics economically viable, Russian Railways will have to offer Belarus a great discount. We estimate it at 70-80% of the basic rate. As we know, a maximum of 50% was under consideration during the recent negotiations. In case of that sound discount, Russian Railways will have to work for nearly a loss. Without it, Belarus will be on the losing side," Vitaly Chernov, Editor-in-Chief, PortNews.ru, commented on the issue of redirecting the exports of Belarusian oil products back in September 2020.

Source: PortNews.ru

Photo: Mozyr Oil Refinery