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Russian state-controlled natural gas monopoly Gazprom will reduce natural gas deliveries to Belarus by 45 percent Aug. 3, although natural gas exports transiting Belarus to the European Union will continue, Gazprom announced Aug. 1. The reduction follows Belarusian Prime Minister Sergei Sidorsky's unsuccessful negotiations with Russian Prime Minister Mikhail Fradkov on July 30-Aug. 1 for a $1.5 billion loan from Russia to pay off its $456 million energy debt to Gazprom. In Russia's eyes, Belarusian President Aleksandr Lukashenko wasted both Belarus' negotiating time and Gazprom's (and thus the Kremlin's) patience by focusing on internal politics rather than the issue at hand.

To resolve the situation, Lukashenko will have to either ask Europe to repay the debt -- a move that would require Lukashenko to overcome his concerns that the West wants him out of power -- or bend to Moscow's will and surrender more of Belarus' energy assets to Gazprom. Neither choice is particularly appealing for the Belarusian president.

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