Sanctions against Serbia’s Oil Industry (NIS), due to Russian ownership shares, have been postponed for 30 days, Serbian President Aleksandar Vučić announced on his Instagram account.
The sanctions were set to take effect today, but the U.S. granted Serbia a last-minute reprieve, delaying their implementation.
Yesterday afternoon, news broke that Gazprom Neft reduced its ownership stake to 44.85%, transferring six percent of its shares free of charge to its parent company Gazprom, a Russian firm not under sanctions. It remains unclear whether this mostly cosmetic change, given that the two companies are connected, influenced the U.S. decision to hold off on sanctions, even though it formally meets the criteria.
Dubravka Đedović Handanović reassured the public that even if the sanctions take effect, there is no reason for fear or panic, despite the fact that NIS covers 80% of the market.
“Tomorrow is not D-Day, nor will anything drastic happen. Working groups continue their efforts, and we are in discussions with both sides. The government has multiple plans and scenarios in case the sanctions are not postponed. Serbia has already started increasing its reserves—mandatory reserves have grown by over 50% in the past two and a half years. We now have enough for about three months, but the goal is not to use them,” Đedović Handanović stated, adding that citizens can continue refueling as usual.
Despite the minister’s reassurances, not everyone is convinced. Economist Goran Radosavljević warned that if sanctions are imposed, NIS would struggle to function if it falls under any kind of financial blockade. He explained that banks freezing accounts or calling in debts could lead to serious disruptions.
“NIS controls 80% of the wholesale and retail fuel market. If you cannot buy fuel from NIS, even if the fuel physically exists, access will be difficult. I hope the government has considered this and developed a Plan B. There’s no need to panic, but we must be realistic and prepare for the next 30, 90, or even 180 days, depending on how long the sanctions might last. No one can predict how long this situation will continue,” Radosavljević told Nova.rs yesterday, before it was confirmed that sanctions would be delayed.
Minister Handanović stated that Serbia has 90 days’ worth of oil reserves, leading to the question: Does this mean the country is safe for three months?
Radosavljević argues that while this may be true on paper, the reality could be different.
“There are some petroleum derivatives currently on the market, but these are not just mandatory reserves—there are also company reserves and state commodity reserves. I think focusing on 30, 90, or 100 days is irrelevant. The real issue is: How will these products reach consumers? How will they be paid for? How will they be purchased?” he emphasized.
Asked about Minister Đedović Handanović’s claim that MOL will double its supply capacity, Radosavljević pointed out that MOL has so far supplied a maximum of 10% of the market.
“If they double that, it will still only be 20%. Do you think 20% is greater than 80%? That is not enough,” he said.
Fuel prices in Serbia are regulated weekly by the government, and if sanctions were imposed, prices would be affected by potential shortages.
Radosavljević warned that in such a scenario, official prices would become irrelevant, as black market fuel sales could emerge.
“If fuel shortages occur, a black market could develop, which would not be good. However, it is difficult to predict whether this will happen. It would be highly irresponsible for the government to allow this situation to escalate. If the state has done its homework, we should not see major disruptions. The government could also negotiate exemptions for key consumers, such as large agricultural enterprises, major companies like EPS, public transport (GSP), and Air Serbia,” Radosavljević concluded.
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Source: Nova.rs, Foto: Naftna Industrija Srbije