Russia's overall business model is now in danger

  Russia's overall business model is now in danger

On April 19, Russia's neighbor Belarus discovered a significant deterioration in the quality of crude oil sent through the Druzhba pipeline through Belarus to Europe. The name of the red shipping channel means "friendship" and was built during Soviet times to supply the Kremlin's friends behind the iron curtain. Today, the pipeline is the longest in the world and possibly the most important in Europe, and feed both east and west.

Russia's economy and federal budget are heavily dependent on revenue from hydrocarbon production and delivery. The Trump administration has created the Nord Stream II pipeline, which is currently designed to supply natural gas to Germany, a European security issue.

Poland and Germany have suspended accepting supplies from the Druzhba pipeline. Belarus has made an offer to Russia to reverse the oil flow to get rid of contaminated oil and start pumping oil via an alternative route, Belgian state oil concern Belneftekhim said on Thursday, Reuters reported.

Chemical pollution has been linked to a Russian storage facility along the pipeline. Belarus has complained that the infrastructure may have been damaged by the chemicals involved.

"Pumping through the southern Druzhba pipeline to Central and Eastern Europe was stopped overnight, Ukraine said. It brought the link to a complete stop since the larger northern branch of the connection through Belarus to Poland and Germany had already closed. Europe will be deprived of at least 1[ads1] million barrels per day of raw currents during the outbreak, Bloomberg said.

"Technical problems related to the transit of Russian oil will be resolved constructively," declared Deputy Minister Pavel Sorokin in joint negotiations with the Belarusian government in Minsk Friday, Russian state news agency TASS reported.

Belneftekhim's concern holds the discussion between the operators of the Druzhba pipeline on Friday to discuss the problems associated with Russia's oil transit. Representatives from Belneftekhim, Transneft, Russia's energy ministry, Russian railways, operators of Oil pipeline Druzhba in Ukrainian and Polish territories orium participates in the meeting.

On April 19, the Belarusian side reported a sharp deterioration in the quality of the Russian oil passing through the Gomeltransneft Druzhba main oil pipeline. Representatives of Belarus and Russia had a meeting on April 23 to discuss the problems related to the situation around Russia's crude oil supply. Belneftekhim's concern Andrey Rybakov had another meeting in Moscow on April 25, focusing on the problems of Russia's oil supply.

Russian Deputy Prime Minister Dmitry Kozak promised that quality oil from Russia would come to the border with Belarus on 29 April. The plan is to discuss the possibility of partial pumping of bad oil from the pipeline in Belarus and Poland on April 26, 19459009, wrote TASS.

Moscow is keen to solve the problem quickly as this type of reputational hit could have existential consequences for its state-of-the-art energy business model.

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