Russia and Belarus have agreed on a new price structure for oil tariffs after Russia halted its vast oil supplies to Europe earlier this week.

“For 2007, an export tariff of $53 will be paid for every tonne of the 20 million tonnes of crude oil delivered to Belarus,” Russian Prime Minister Mikhail Fradkov said after negotiations concluded here late Friday.

The agreement appeared to bridge the difference between Russia’s demands for a $180-per-tonne and Belarus’ insistence on a $45-per-tonne tariff.

Belarus has cashed in on billions of dollars by re-exporting high quality fossil fuel to the EU, manufactured in Belarusian refineries from cheap Russian crude oil.

The trade spat between the two former Soviet republics peaked this week when Minsk blocked oil deliveries, affecting Germany and other EU countries.

Talks had been on hold for over two hours Friday evening, as Belarusian Prime Minister Sergei Sidorsky sought agreement from Minsk on “certain points”, an unidentified Belarusian delegate told Itar-Tass.

Spokesmen for Belarusian President Alexander Lukashenko said he and his Russian counterpart Vladimir Putin ordered the prime ministers to strike an agreement on tariffs and oil profit-sharing by day’s end.

The two heads of government started the meeting with one-on-one talks and were joined an hour later by delegations from their respective countries.

Moscow Thursday opened discussions with its former Soviet partner over a tariff Russia introduced Jan 1 on oil it sends to Belarus for refinement.

The massive Druzhba pipe, which pumps 80 million tonnes of Russian “black gold” into Europe each year, was shut down Monday by Belarus after the Kremlin refused to accept a Belarusian transport tariff that was levelled in response to the Russian tax.

Exports of Russian oil, which covers approximately a quarter of Europe’s needs, were halted for three days as Moscow insisted it would start talks with Minsk only after Alexander Lukashenko’s pariah state cancelled its retaliatory tariff and resumed the oil flow.

After Lukashenko called Russian President Vladimir Putin Wednesday, Belarus repealed its tariff of $45 per tonne of oil and began pumping oil into Europe.

Poland, Germany, Hungary, Slovakia, the Czech Republic and Ukraine were all either cut off entirely from the flow or saw reduced delivery volumes as a result of the dispute.

While European reserves protected consumers against serious oil shortages, the disagreement has caused the EU to once again question Russia’s reliability as an energy partner.

Russia cut off natural gas supplies to the Ukraine amid a pricing dispute just over a year ago, and many in the EU worry the source of a third of their gas and a quarter of their oil needs may hold those supplies hostage in order to settle political disputes.

As a result, the EU pledged this week to draft a new energy document outlining plans to reduce reliance on Russia and other outside parties for its energy needs.

IANS