ESTONIA: DEMONSTRATORS SHIFT FOCUS TO EC AS OIL

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 002086

SIPDIS

SIPDIS

E.O. 12958: DECL: 05/07/2017
TAGS: PREL ETRD ENRG EN RS
SUBJECT: ESTONIA: DEMONSTRATORS SHIFT FOCUS TO EC AS OIL
CONTINUES TO FLOW

REF: A. TALLINN 297

B. MOSCOW 01998

C. MOSCOW 02017

D. MOSCOW 02056

Classified By: Ambassador William J. Burns. Reasons: 1.4 (b/d).


1. (C) Summary: The Estonian Embassy was quiet over the
weekend, and Embassy officials expect their Ambassador to
return to Moscow in two weeks. At the 90-minute May 4
demonstration at the European Commission offices, militia
outnumbered protesters. Russian Railways has capped
shipments of oil products for some Russian shippers but the
volumes look to be enough to satisfy Estonian domestic
demands and work arounds are available. Press reports
indicate that May's Russian coal shipments to Estonia are in
jeopardy, but Russian Railways denies that coal shipments
have stopped. Almost all of these Russian imports are
destined for re-export from Estonia. The Kremlin is working
on a new initiative to spend USD $1 million annually for
protection of Russian military burial sites in Central and
Eastern Europe. End Summary.

"NICE" TO BE CALLED A FASCIST
--------------


2. (C) The Estonian Embassy was quiet over the weekend.
Estonian Press Attache Franek Persidski told us May 7 that
the consular section was open for business and no
demonstrators had visited the Embassy since early Friday
morning. Estonian Ambassador Marina Kaljurand, who left for
Tallinn for "vacation" May 3, as part of a quiet face-saving
deal to end the protests, was expected to return to Moscow in
two weeks, Persidski said. He added that Russian authorities
had informed the Embassy that Vladimir Zhirinovskiy's Liberal
Democratic Party planned to picket the Embassy on May 9 --
Russia's World War II Victory Day holiday. The demonstration
is expected to last two hours and Estonian Embassy officials
are not expecting it to be as large or as confrontational as
last week's protests. "I'm sure they will call us fascists,"
Persidski said. "For us here in Moscow, it is a good day
when all they do is call you a fascist."

MORE COPS THAN DEMONSTRATORS
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3. (C) Pro-Kremlin youth groups shifted their focus May 4
from the Estonian Embassy to the offices of the European
Commission in Moscow, protesting the apparent detention of
ethnic-Russian high school student Mark Siryk by Estonian
officials following last week's riots in Tallinn. The
demonstration, organized by the youth group Nashi (Ours),was
not as aggressive as last week's demonstration outside the
Estonian Embassy, EC press spokesman Sean Carroll told us.
The demonstration, which included a smattering of
demonstrators from other pro-Kremlin youth groups and high
school-aged children, totaled about 400 participants.
Carroll estimated that there were about 500 militia on hand,
noting that authorities kept the demonstrators at a distance.
Organizers erected a sound stage and blared insults about
"Fascist Estonia," but the demonstration lasted only about 90
minutes.

KREMLIN INITIATIVE
--------------


4. (C) In a move last week, apparently linked to the Bronze
Statue controversy, the Ministry of Defense's Military
Memorial Center of the Russian Armed Forces announced that
the Kremlin had drafted a decree specifying that USD $1
million should be spent annually for protection of Russian
military burial sites in Central and Eastern Europe.
General-Major Aleksandr Kirilin, chief of the Memorial
Center, said much of the money would be allocated to protect
burial sites in Germany, but some would be spent for sites in
what he called "problem countries," such as Poland, Hungary
and the Baltic States, according to Kommersant. Kirilin did
not specify how exactly the sites would receive additional
protection.

OIL PRODUCTS REDUCED BUT FLOWING
--------------


5. (C) According to a contact at TNK-BP, Russian Railways
(RZD) has capped -- but not halted -- oil product exports to
Estonia for most Russian shippers. RZD's press secretary
Elena Fedorovna told us May 7 that her company introduced a
new schedule for a "yearly renovation program" that will run
from May to September. She said that during this time some
deliveries may need to use alternate routes but that there
would be no shut-down of service. TNK-BP's export cap is set

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at about 42,000 tons/month. Surgutneftegaz is the only major
shipper without a cap, sending 80,000 tons/month from its
Kirishi refinery. These figures suggest that Estonia is
receiving enough to meet domestic needs with some left over
for re-export. Further, Russian shippers continue to
re-route volumes that would otherwise transit Estonia,
continuing to meet their downstream European commitments.
However, TNK-BP said that they are losing money as a result
of RZD's action. TNK-BP expects that the situation will
"return to normal in one week."

COAL CUT-OFF
--------------


6. (C) According to press reports, Russian coal exports to
Estonia have ground to a halt as a result of RZD's
requirement that exporters use their own -- rather than RZD's
-- rail wagons. One exporter said that May's scheduled
exports of 900,000 tons are at risk. Estonia uses little, if
any, Russian imported coal domestically. However, RZD's
Fedorovna said that her company did not tell coal shippers to
use their own wagons and that coal continues to be shipped to
Estonia. An analyst at a Moscow investment house said that
coal exports are extremely sensitive to pricing, so, if
shipments have stopped, re-routing coal exports may not be an
option. Instead, he said that the coal may not be exported
but could be used to, for example, accelerate the re-stocking
of coal reserves at Russian coal-fired power plants.

COMMENT
--------------


7. (C) The May 9 Victory Day celebration may keep
temperatures elevated, but the GOR appears to have signaled
an end to the anti-Estonian Embassy campaign. The effect on
bilateral relations, however, will continue to play out and
we will track closely whether this issue will play into
future GOR-GOE-EU energy relations.
BURNS