Europe

Lithuania gas supply falls after Russia-Belarus dispute

A gas worker at the Yamal-Europe pipeline near the town of Nesvizh, Belarus (file)
Image caption Lithuania, Germany and Poland would be worst affected by a supply cut

Lithuanian gas supplies from Russia have fallen 30%, as an energy dispute between Russia and Belarus escalates.

Lietuvos Dujos, Lithuania's national gas company, said it had noticed changes since 0900 GMT.

Russia has cut supplies to Belarus by 60% over a payments dispute, but had insisted that European countries on the transit route would not suffer.

Lithuania, the first EU country to be affected, has said it is now preparing to import gas via neighbouring Latvia.

Russian gas monopoly Gazprom said it cut supply to Belarus by 15% on Monday, a further 15% on Tuesday, and another 30% on Wednesday.

The company is demanding Belarus pay almost $200m (£135m) it says is owed for Russian gas, but Belarus says Russia owes money for using pipelines.

Transit route

Gazprom has said that EU customers would remain unaffected, as gas could be re-routed through the other transit pipeline, which crosses Ukraine.

Belarus' energy ministry however had warned the European Commission that reductions of more than 15% could have a knock-on effect to other countries dependent on the pipeline.

Lietuvos Dujos said that Latvia had agreed to meet Lithuania's request should it be required.

Lithuania's energy minister, Arvydas Sekmokas, said he did not expect to face "major problems", as energy demand during summer was less.

"We are prepared, if needed, to get gas via Latvia. If there is a major reduction, it is possible we'll limit consumption," he told AFP news agency.

Most Russian gas bound for European countries goes via Ukraine, but Lithuania, Germany and Poland rely on supplies through Belarus.

Poland and Germany, who also rely on gas from Belarus, have not reported a drop in supplies.

'Gas war'

Gazprom has threatened to continue tightening the taps until supply is down to only 15% of its previous level.

Belarusian President Alexander Lukashenko warned of a "gas war", and insisted that Belarus is owed $260m (£176m) by Russia in fees for using transit pipelines.

Russia increased the price of gas supplied to Belarus from $150 per 1,000 cubic metres of gas last year, to $169.20 in the first quarter of 2010 and $184.80 in the second.

But Belarus has continued to pay $150. Gazprom said at that rate it could owe $500m or $600m by the end of the year.

Gazprom said in a statement on Wednesday that Belarus had paid for May's deliveries at a higher price, thus "recognising the need" to pay increased rates - but that it still had to settle debts accrued in the first four months of the year.

"The Belarusian side is undertaking no action to settle the debt for Russian gas supplies," Gazprom's chief executive Alexei Miller said in a televised appearance on Wednesday.

Belarus has previously insisted Russia provide it with cheap oil and gas as part of a customs union deal that is due to come into force next month.

Russia and Belarus are supposed to be close allies but have had several rows in recent years, particularly over energy supplies.

Russia has cut gas supplies to both Ukraine and Belarus several times in recent years.

More on this story