Hungarian PM to meet Serbian leader to discuss energy cooperation

Hungarian Prime Minister Viktor Orban will meet Serbian President Aleksandar Vucic on November 27 to discuss energy cooperation, as Serbia seeks to prevent a fuel shortage caused by sanctions on its sole refiner, NIS, which is controlled by Russia’s Gazprom PJSC.

Gergely Gulyas, head of the Hungarian prime minister’s office, said Hungarian energy company Mol is negotiating with Serbia over a possible purchase of Gazprom’s stakes in Serbian oil company NIS and the resumption of fuel supplies, Caliber.Az reports, citing Bloomberg.

“These talks are going on right now. NIS’s interest is for Russian ownership to cease, given that this is the reason for economic difficulties due to the sanctions. Mol taking on a bigger role could be an opportunity,” Gulyas said.

Gulyas refused to confirm or deny reports that Orban would travel to Moscow on November 28 to meet Russian President Vladimir Putin, whose support would be crucial for any deal involving Russian energy assets.

Widely regarded as the EU’s most Kremlin-friendly leader, Orban is looking to capitalise on his ties as Russian companies face pressure to sell assets rendered effectively inoperable by US sanctions, including Lukoil PJSC’s refineries in Bulgaria and Romania.

Earlier, Vucic stated that Belgrade would give Russian owners — Gazprom Neft (44.9%) and Gazprom (11.3%) — 50 days to sell their shares.

Otherwise, the Serbian government is prepared to take over management of the company and offer a buyout.

The decision also depends on a license from the US Office of Foreign Assets Control, without which NIS cannot continue operations.

Serbia’s NIS (Naftna Industrija Srbije), the operator of the country’s sole oil refinery, is majority-owned by Russian companies, primarily Gazprom Neft and Gazprom. 

Sanctions have disrupted crude deliveries, including through Croatia’s JANAF pipeline, sparking concerns that the refinery could halt production and threaten fuel availability this winter.

By Jeyhun Aghazada