- The Washington Times - Tuesday, January 9, 2007

Russia has shut down a major pipeline to Europe for the second winter in a row — this time an oil pipeline through Belarus. While understandably reminiscent of last year, when state-controlled Gazprom shut off the flow of natural gas through Ukraine, the dispute has less serious repercussions for Europe than did the 2006 energy standoff. The EU imports a significantly higher percentage of Russian natural gas through that pipeline than it does Russian oil through Belarus. The effected European countries, most notably Germany and Poland, also maintain sufficient strategic reserves to mitigate the short-term impact of such a shutoff. But the oil cutoff demonstrates Russia’s continued willingness to wield its energy resources as a political weapon and the vulnerability of Europe’s energy supply to Russia’s disagreements with its neighbors.

Like the 2006 standoff with Ukraine, the recent quarrel has political underpinnings. Alexander Lukashenko — Europe’s last true dictator — retained his grip on power in Belarus after a sham election in March 2006. Essential to Mr. Lukashenko’s Soviet-style political model is heavily subsidized oil and gas imports from his close ally and enabler, Vladimir Putin. Moscow announced soon after that election, however, that the days of cheap oil and gas were coming to an end. On Jan. 1, Minsk consented to a last-minute deal that would double the price of natural gas for Belarus in 2007, followed by additional increases in subsequent years that will eventually have Belarus paying market price. When Moscow placed a duty on crude transported through Belarus, Mr. Lukashenko responded with his own tax — and by stealing some of the oil en route.

The two leaders previously held talks on creating a unified state, but Mr. Lukashenko bristled at Mr. Putin’s suggestion that Belarus become a Russian province, not a partner. Still, Mr. Putin holds all the cards: In addition to supplying Belarus with discounted gas and oil, Russia is the largest market for Belarus. With the new gas deal inked — and, inevitably, a similarly less-favorable new oil deal — the Lukashenko regime faces the prospect of subsidizing energy costs for its citizens at the same time that its profitable refining industry, which refined cheap Russian crude for sale in Europe, will be generating less revenue. Mr. Lukashenko will likely find this combination unsustainable. One way to stave off Belarus’ pending economic crisis would be to open its economy to basic reforms, but considering Mr. Lukashenko’s first decade in office, this seems all but impossible.

Sharing some of the blame for the shutdown, Mr. Lukashenko will find himself even less welcome by the West, which means Belarus will be compelled to settle inflamed tempers and rekindle its relationship with Russia, or face complete political isolation.

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