Serbia's fuel imports drop due to low Danube levels, energy minister says
Serbia’s fuel imports fell to 25% of their monthly target for July as low water levels on the Danube River choked off barge deliveries, Energy Minister Dubravka Djedovic Handanovic said on Wednesday.
After a meeting with representatives of oil companies in Serbia, she said the logistics crisis showed the country's dependence on its single domestic refinery, operated by the Russian-owned and U.S.-sanctioned oil firm NIS.
Danube levels fell to record lows this week in Hungary, Serbia and Romania, forcing barges and tankers to operate at 30% to 40% of their cargo capacity.
Djedovic Handanovic said fuel has been transported by road or rail instead, but that further pushes up prices that are already "exceptionally high".
Serbia has around 269,000 metric tons of diesel in state strategic reserves, but the NIS refinery in the town of Pancevo, with an annual capacity of 4.8 million tons, is crucial for around 80% of the Balkan country's demand.
The U.S. Office of Foreign Assets Control imposed sanctions on NIS last October as part of wider measures targeting Russia's energy sector over the war in Ukraine, and demanded its Russian majority owners Gazprom Neft and Gazprom divest their shares.
OFAC granted NIS several sanctions waivers allowing it to import crude via Croatia's Janaf pipeline while Hungary's MOLMOLB.BU completes its acquisition of the Russian-owned stake. The current NIS waiver expires on July 31.
"If the NIS license is not extended, (market) supply will depend entirely on state reserves," Djedovic Handanovic said.
MOL signed a provisional agreement in January to buy a combined Gazprom Neft and Gazprom 56% stake in NIS. After several extensions, OFAC also gave companies until July 31 to complete the sale.
The Serbian government owns 29.9% of NIS, with the remainder held by small shareholders and employees.
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