US sanctions against NIS are forcing Belgrade to make ‘tough’ decisions or risk a national energy crisis
Serbia is considering taking control of the country’s only oil refinery, NIS (Petroleum Industry of Serbia), which is majority-owned by Russian energy giant Gazprom, Energy Minister Dubravka Djedovic-Handanovic said on Saturday.
She said US sanctions on the company had left Belgrade with few options if it wants to keep the facility operating.
In October, Washington imposed sanctions on the NIS, prompting neighboring Croatia to halt crude oil deliveries and raising the risk of a refinery shutdown. The restrictions also affected NIS-operated fuel stations, which can no longer process payments made with American Express, Mastercard or Visa cards.
”In the coming days we may face some of the most difficult decisions in our history” the minister said at a press conference, adding that Belgrade will have to “take over the company and then afterwards determine and carry out compensation for damages.”
The minister said she hoped that “our Russian friends will understand the gravity of the situation and will help us overcome it.”
She added that the issue will be discussed on Sunday at a government session attended by Serbian President Aleksandar Vucic and the heads of domestic public companies.
NIS is a major Balkan energy producer, with a refinery in Pancevo near Belgrade and a regional network of more than 400 fuel stations. Gazprom Neft owns 44.85% of the company and Gazprom owns 11.3%. The Serbian government has about 29.87%.
Earlier this week, the Russian owners asked Washington to extend NIS’s operating license while they sought to transfer control to a third party. The US, however, insists on a complete Russian exit and has not granted NIS “a single day to continue operating,” Djedovic-Handanovic said.
Serbia has resisted Western efforts to align its foreign policy with the EU even as it seeks membership. Brussels and Washington have urged Belgrade to cut its energy links with Moscow. The Serbian leadership has also accused Western states of encouraging mass protests in the country.
Several EU members, including Hungary and Slovakia, have raised similar concerns over pressure to abandon Russian crude. Tensions rose earlier this year after Ukrainian strikes hit parts of the Druzhba pipeline through which Russian oil flows into Eastern Europe. In January, Hungary and Serbia agreed to accelerate plans to connect the Druzhba network’s Serbian consumers.
