C.I.S. MEMBERS SEEKING MORE RUSSIAN CRUDE

Members of the Commonwealth of Independent States are becoming frantic in their attempts to import more crude from Russia, whose supply keeps falling as its oil production plummets. Moscow remains by far the largest seller of crude to previous U.S.S.R. member states, but it has been forced to cut 1993 quotas drastically to maximize hard currency sales to other nations. It emphasizes that former Soviet republics owe Russia 432 billion rubles for oil, natural gas, and electricity already

July 19, 1993

2 min read

Members of the Commonwealth of Independent States are becoming frantic in their attempts to import more crude from Russia, whose supply keeps falling as its oil production plummets.

Moscow remains by far the largest seller of crude to previous U.S.S.R. member states, but it has been forced to cut 1993 quotas drastically to maximize hard currency sales to other nations. It emphasizes that former Soviet republics owe Russia 432 billion rubles for oil, natural gas, and electricity already delivered.

The outlying republics are resorting to all possible means to get Russian oil in excess of official quotas, especially by direct negotiations with western Siberian producing associations. In desperation, Tadzhikistan has offered to rent Russia some of its state farms for crude. Other former Soviet states are considering proposals to sell or lease state owned enterprises to Russia at discount prices for oil. But such deals would pay back only a tiny part of what the debtor republics owe Moscow for energy.

The plight of Belarus, where gasoline is now almost unobtainable at filling stations, is a case in point. Belarus crude production is only about 40,000 b/d, while its oil consumption exceeds 500,000 b/d. Moscow has agreed to deliver 226,000 b/d in 1993 to Belarus, which has two refineries capable of processing 800,000 b/d.

Last year, Belarus was able to obtain 112,000 b/d of crude from Russian commercial enterprises, refine it, and sell part of the products to former Soviet Baltic republics as well as to nations in eastern and western Europe. But illegal petroleum products exports caused a scandal that forced mass resignations of Belarus government energy officials.

This year, Belarus believes it has better control over unlicensed petroleum products exports. But it has been unable to obtain above quota crude from Moscow despite urgent pleas.