OSW Commentary - The end of prosperity: The state of Belarusian refineries - Petrochemical industry as an economic pillar

OSW Commentary 622 OSW Commentary CENTRE FOR EASTERN STUDIES NUMBER 622 29.08.2024 www.osw.waw.pl The end of prosperity: The state of Belarusian refineries Kamil Kłysiński The sanctions imposed by the West after 2020, along with the involvement of Alyaksandr Lukashenka’s regime in the invasion of Ukraine, have severely impacted Belarus’spetrochemical sector. [...] Difficult adaptation The deterioration in relations with the West triggered by the repression of opposition forces after the 2020 presidential elections in Belarus, coupled with the resulting sanctions, placed the country’s refineries in a challenging position. [...] According to the latest data from the first quarter of 2024, petroleum products accounted for nearly 33% of the 4.6 million tonnes of Belarusian cargo transported during that period, with the majority directed to ports in northwestern Russia, particularly in the Leningrad Oblast.5 Furthermore, some fuel exports have been redirected to the Russian market, as evidenced by the in- complete data from. [...] As a result, the oil sector recovered to some extent from the downturn caused by the loss of key external markets and the increased costs of transporting goods to more distant Russian ports, as opposed to the closer Lithuanian and Latvian ports. [...] Therefore, both refineries have initiated efforts to diversify into the production of chemicals used in domestic and foreign industries, such as propylene, polypropylene, benzene, and polycarbonate.7 The Belarusian fuel sector is grappling with profitability, as indirectly evidenced by the financial results of companies in the Mazyr region and the city of Navapolatsk during the first two months of.