UPDATE 2-Russia threatens Belarus with months of oil supply cuts

Thu Aug 29, 2013 2:24pm EDT
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* Belarus entirely dependent on Russian oil

* Belarus hold Uralkali CEO Baumgertner

* Says it could seek to prosecute Uralkali shareholder Kerimov

By Vladimir Soldatkin

MOSCOW, Aug 29 (Reuters) - Tension between Russia and Belarus rose on Thursday as Moscow warned oil supply cuts to its energy-poor neighbour could last for months, and Minsk threatened to open a criminal case against a Russian tycoon with Kremlin ties.

The close but often rocky relationship between the ex-Soviet states hit a major bump this week when Vladislav Baumgertner, the chief executive of potash company Uralkali, was arrested in Minsk.

On Wednesday, Russia ordered its oil companies to cut supplies to Belarus by about 25 percent, prompting talk of a trade war. Belarus relies entirely on Russian oil to keep its two major refineries running to supply the local market.

Russian pipeline monopoly Transneft said on Wednesday Russia would cut oil supplies to Belarus by 400,000 tonnes in September due to maintenance work at the trunk pipeline.

On Thursday, Russian news agencies quoted Deputy Prime Minister Arkady Dvorkovich as saying Belarus would receive reduced volumes of oil in the fourth quarter, indicating the cuts would carry on long past September.   Continued...