US Sanctions Impact Serbia's Oil Industry
US sanctions, which became effective last month, have impacted Serbia's national oil company, Petroleum Industry of Serbia (NIS). This impact is due to NIS's majority ownership by Russian state-owned energy firms Gazprom and Gazprom Neft, and has introduced challenges within Serbia's energy sector.
Operational and Supply Chain Disruptions
Following the implementation of US sanctions, NIS petrol stations have ceased accepting Visa and Mastercard payments. This operational change also applies to outlets operated by NIS's Russian shareholders. At certain Gazprom service stations in Serbia, customers are now required to pay for fuel in cash.
NIS operates both of Serbia's oil refineries, which are responsible for producing over 80% of the country's petrol and diesel, and nearly all of its jet and heavy fuels. Serbia, a landlocked nation, relies on the Janaf pipeline in Croatia for crude oil deliveries. Since the sanctions took effect, the flow of crude oil via this pipeline has been interrupted. Serbian Energy Minister Dubravka Djedovic Handanovic has stated that NIS refineries are projected to deplete their crude oil supplies by the end of November.
Air Serbia, the national airline, has reported adjusting its business operations and implementing measures to ensure continued flight services amidst these developments.
Diplomatic and Economic Responses
Serbian Energy Minister Dubravka Djedovic Handanovic informed the BBC that NIS's Russian owners have submitted a request for a waiver from the US, indicating a willingness to transfer control and influence over the company to a third party.
Other Balkan nations have also navigated US sanctions. Bulgaria has legislated to assume control of its sole oil refinery from Russia's Lukoil ahead of sanctions slated for November 21. Hungary's Prime Minister Viktor Orban secured a one-year waiver from US President Donald Trump.
Serbia has not pursued nationalization of NIS, a contrasting approach to Bulgaria's handling of Lukoil. This stance is attributed, in part, to historical relations with Russia. Serbia is a candidate country for EU membership but is not currently a member; the EU has implemented a ban on Russian oil imports.
Statements exchanged between Serbian President Aleksandar Vucic and the Kremlin have highlighted differing positions on Russian gas supplies and Serbia's arms trade, in addition to the NIS situation.