The current tensions began last week, after the July 30 announcement by Russian potash firm Uralkali that it would end its agreement with its Belarusian counterpart, Belaruskali. Belarus and Russia are among the world's largest producers of potash, a key chemical used in fertilizers. The two companies, which made up the Belarusian Potash Co., accounted for 43 percent of the global potash export market.

The two sides have been in disagreement since Belarusian President Aleksandr Lukashenko withdrew the Belarusian Potash Co.'s sole right to export Belarusian potash, and Russian officials maintained that any exports made outside of the consortium were "unacceptable." The result was Uralkali's dissolution of the potash exporting joint venture, which led to a decrease in global potash prices by 25 percent. 

While Belarus has very close economic ties with Russia and is closely integrated with Moscow through the Customs Union, the latest spat is a reflection of Minsk's desire to diversify its economic relationships, albeit under substantial constraints. Belarus has been isolated from the European Union and United States for political reasons. This has all but eliminated the West as a viable economic partner for Belarus. Belarus has instead sought to build closer ties to Asian and Middle Eastern countries such as China, Vietnam and Iran, which is an attractive trade and investment partner due to its agricultural and industrial sectors. Belarus' potash industry was particularly sought after; Russia, China and India all expressed interest in picking up substantial stakes in Belaruskali in a potential sale of the company.

But rather than sell Belaruskali, Lukashenko sought to diversify exports and loosen ties to Moscow in this field, eventually leading Uralkali to end the joint venture. On Aug. 5, Belaruskali reached an agreement with Qatar's state-owned fertilizer distributor Muntajat to sell up to 3 million tons of Belarusian fertilizer per year. However, this move does not give Belarus all the financial reprieve it needs, due to the sharp fall in potash prices and the dependence of the Belarusian economy on the fertilizer, which accounted for more than $3 billion in exports per year. This likely explains why Belarus raised duties on its oil product exports to Russia, creating a deficiency in Moscow's supplies and leading Russia to halt its gasoline exports for the time being. While Russia and Belarus had an agreement in place for Russia to import 3.3 million tons of oil products from Belarus in 2013, only 630,000 tons have been shipped so far this year.

However, this is likely to lead only to a temporary disruption of exports. In previous economic quarrels, such as the disagreement over transit fees and oil duties that arose between Minsk and Moscow in 2010, Russia has proved that it has the greater leverage in the relationship, using energy cutoffs and price manipulations to take advantage of Minsk's energy and economic dependence on Moscow. Therefore, it can be expected that there will be an eventual resolution to the oil products issue that will likely favor Russia. However, a resolution will not come without some economic turbulence for both countries in the short term.