September 17, 2013 / 9:26 AM / in 4 years

UPDATE 1-Russia to cut oil flow to Belarus by 42 pct in Q4-schedule

* Russia oil exports to Belarus seen at 3.1 mln T in Q4 vs 5.3 mln in Q3

* Moscow announced cuts to Belarus following potash boss arrest in Minsk

MOSCOW, Sept 17 (Reuters) - Russia will cut oil pipeline supplies to Belarus by 42 percent in the fourth quarter, an export schedule showed on Tuesday, amid a spat over the arrest of a Russian potash industry boss in Minsk last month.

According to the schedule, Russia will ship 3.1 million tonnes of oil (62,000 barrels per day) to refineries in Belarus via pipeline in October-December, down from 5.3 million tonnes originally planned for the third quarter.

Russian oil pipeline monopoly Transneft has also said oil shipments to Belarus would be cut by 233,000 tonnes in September due to pipeline repairs.

The full fourth-quarter schedule of oil transit via Transneft has not yet been approved, industry sources said. Russia’s total oil exports had been expected to decrease as more local refineries will be coming onstream after a heavy maintenance schedule in September.

News of the cuts followed the arrest of Vladislav Baumgertner, chief executive of the world’s top potash producer, Uralkali, at Minsk airport on Aug. 26 while the Belarusian leadership was still infuriated at the company’s withdrawal from a potash cartel with state-owned Belaruskali.

Relations between Russia and Belarus have been bumpy with sporadic spats over gas pricing and food quality. Last month’s arrest shook relations between the two countries, though generally Moscow and Minsk are seen as allies.

The forthcoming cuts were first flagged by Russian Deputy Prime Minister Arkady Dvorkovich, who has insisted that Russia would supply Belarusian refineries with 18.5 million tonnes of oil this year, not 23 million tonnes as Minsk has hoped.

Russia has supplied its neighbour with around 5.75 million tonnes of oil each quarter so far this year, or more than 17 million tonnes, both by pipeline and railroad.

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