News analysis

The Russian Federation and the Republic of Belarus have settled an energy dispute that threatened to harm their relations and disrupt the world oil supply. Belarus was able to achieve a favorable compromise by winning popular support both at home and in Russia.

Russia, which historically has sold energy to former Soviet republics at reduced rates, has recently been moving fuel prices toward market rates.

Opponents charge that Russia has been using the threat of price increases as a tool to keep nearby nations subservient. The Russian government counters that not only are Russia and Belarus close allies, but they are also moving toward a united state.

A decade ago, under pressure from the Communist Party of the Russian Federation (CPRF), Boris Yeltsin signed a treaty to reunite the two nations. However, the process has been thorny. Currently, Belarus argues that both nations should be considered equals in any merger. On the other hand, Russian President Vladimir Putin has said that Belarus should be “absorbed.”

In January, Belarusian President Alexander Lukashenko said that he would fight for Belarus to maintain its independence from both U.S. and Western imperialism and from great-nation chauvinism from the east (alluding to Russia).

In December Russia announced that it was raising fuel costs for its partner. The Russian state-run gas giant Gazprom raised the price of gas from $47 to $100 per cubic meter of natural gas. Last-minute negotiations resulted in a compromise: Belarus agreed to the increase in exchange for a Gazprom agreement to an increase in duties on gas shipped through Belarus to Europe and elsewhere.

But Russia tried to slap a $180 per ton export duty on all Russian oil shipped to its neighbor. Belarus countered that this was contrary to the “fraternal” nature of the two nations. In retaliation, Belarus put a tax on Russian oil shipped through its borders.

When Russia refused to pay the tax, Belarus took oil from the pipeline as payment. Russia shut off the oil flow, causing a momentary world oil panic.

Socialist-oriented Belarus refines Russian crude oil and sells it abroad, putting the profit into social programs. Thus, a raise in prices would harm the Belarusian people directly.

The public in both countries became involved. Most Belarusians and 44 percent of all Russians thought Russia’s price hikes were wrong. More than 52 percent of all Russians supported Belarus’ retaliatory moves. In Moscow, a mass meeting organized by the CPRF protested the Russian government with chants of “Shame on Russia” and “Belarusians, Russia is with you!”

Under popular pressure, the Russian government agreed to move at a much slower pace toward market prices. In 2006 alone, this represented concessions to Belarus of about $5.8 billion.

Lukashenko thanked the Russian people for their display of support during the spat. “It was one of the decisive moments for settling the conflict,” he said.

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