Energy Crisis

EU ban on Russian oil to boost fuel prices in Southeastern Europe

EU ban on Russian oil supply prices southeast europe

Photo: Gerhard Traschütz from Pixabay


June 6, 2022






June 6, 2022





The European Union’s decision to ban the purchase, import and transport of crude oil and petroleum products from Russia should not hinder the supply to Southeastern European countries, but it is likely to make them more expensive.

In Southeastern Europe, Bulgaria, Croatia, Romania and Serbia import Russian crude oil, and so does Turkey, though its position is completely different.

Bulgaria imports about 50% of its crude, which is processed at Lukoil’s oil refinery in Burgas. Croatia procures vacuum gas oil from Russia, which is necessary for diesel production covering two thirds of the domestic market. The fuel is produced at the Rijeka oil refinery, run by INA, which is owned by Hungarian MOL.

Romania purchases 70% of its oil abroad. Russia accounts for about 30% of the imports or 21% of total consumption. Serbia received 20% of imported oil from Russia last year, which is 15% of total processed oil.

Exemptions were granted to Bulgaria and Croatia as well as to the Czech Republic, Hungary, and Slovakia

Out of these four countries, two have received exemptions from EU sanctions. Bulgaria will be able to import Russian oil and products until the end of 2024, and Croatia will be able to import vacuum gas oil until the end of 2023.

This time Serbia did not receive an exemption like the one in the fourth package of sanctions. Back then the EU allowed oil company NIS to continue importing oil through Croatia, its main transportation route and an EU member state. With the fourth package, the EU banned domestic companies from doing business with another group of Russian firms including Gazprom Neft, the majority owner of Serbian NIS.

Most countries in the region do not import oil but petroleum products

When it comes to exemptions, it was also given to the Czech Republic, Hungary, and Slovakia. They are supplied with oil through the Druzhba oil pipeline from Russia and do not have access to the sea, nor the possibility to buy oil in another way. That is why, as the European Commission said, they will continue to import oil like until now, for an indefinite time. Of course, they will not be able to resell it, nor the products produced from it.

Some of the remaining countries in the region – Albania, BiH, Montenegro, Greece, Cyprus, Kosovo*, North Macedonia, Slovenia – don’t have refineries and thus don’t import oil, while others don’t source the commodity from Russia. Those who import petroleum products mostly don’t buy them from Russia.

Europe now has one less option when buying oil

The oil market in Europe will certainly be disturbed as Russian crude will almost disappear from it. The EU imports about 96% of crude oil, of which about 30% comes from Russia. According to the European Commission, the ban will reduce Russian imports by two thirds.

Russian oil will surely go to other parts of the world, while oil from other suppliers will finish in Europe. As a buyer, Europe now has one less option when it comes to buying oil, which weakens its negotiating position, unlike the rest of the world.

The transition period during the introduction of the ban could somewhat stabilize the market

The market has not reacted so far. The price is around USD 120 per barrel.

It is worth noting that the EU’s decision from a few days ago will come into force in early December for crude, and in early February for petroleum products. The transition period could calm the market to some extent.

Comments (0)

Be the first one to comment on this article.

Enter Your Comment
Please wait... Please fill in the required fields. There seems to be an error, please refresh the page and try again. Your comment has been sent.

Related Articles

EU energy package talks paralyzed by gas price cap rift

EU energy package talks paralyzed by gas price cap rift

25 November 2022 - EU energy ministers agreed on most parts of the gas market reform, but the price cap issue has prevented the formal adoption of the package

windfall profit tax slovenia croatia energy crisis

Croatia, Slovenia to introduce windfall tax

23 November 2022 - Countries around Europe have already introduced a windfall tax to finance generous subsidies paid to the population and businesses

djedovic Electricity, natural gas prices to be increased in Serbia

Serbia to increase prices of electricity, natural gas

22 November 2022 - Minister Dubravka Đedović earlier indicated that the prices of electricity and gas would be raised, arguing they are unsustainable

Vučić: We will have to invest up to EUR 33 billion in energy infrastructure

Vučić: We will have to invest up to EUR 33 billion in energy infrastructure

18 November 2022 - Serbian President Aleksandar Vučić has announced significant investments in energy infrastructure. As he pointed out,...