Hungary has significantly ramped up its oil product shipments to Serbia, Hungarian Minister of Foreign Affairs Peter Szijjarto announced during a visit to Belgrade. The move comes ahead of a planned suspension of Serbia’s sole oil refinery, operated by Naftna Industrija Srbije (NIS), due to US sanctions targeting its Russian-majority ownership structure.
According to Peter Szijjarto, Hungarian energy company Magyar Olaj- és Gázipari Részvénytársaság (MOL) has more than doubled deliveries since November, with further increases possible if needed. The Hungarian official stated that his country is committed to helping Serbia maintain energy security during this period of supply strain.
An anticipated halt at the Pancevo refinery
The Serbian government is attempting to avoid a potential winter energy crisis following the implementation of US sanctions on October 9, linked to the war in Ukraine. These measures directly target the shareholder structure of NIS, whose main stakeholders are Gazprom and Gazprom Neft. The Pancevo refinery, operated by NIS, could face a complete shutdown before the end of the week if no solution is found to secure additional supplies.
Serbian President Aleksandar Vucic stated that current reserves would allow fuel distribution to continue until the end of the year. However, he gave Russian shareholders and potential buyers — including entities from Hungary and the United Arab Emirates — 50 days to reach a deal that would satisfy the US demand for Russian divestment.
Growing pressure on NIS and the Central Bank
NIS has requested a temporary waiver from the sanctions while talks continue, but no response has been received from US authorities. In the meantime, Visa and Mastercard payments are no longer accepted at NIS fuel stations, with only cash and Dina card payments — backed by the National Bank of Serbia — remaining operational.
Amid concerns over a prolonged stalemate, Serbia’s central bank has warned it would cease cooperation with NIS if no deal is reached within the specified timeframe. In parallel, Serbian authorities have introduced a budget provision allowing for state takeover of the company, despite previous reluctance due to the country’s historic ties with Moscow.
Possible ownership shift under review
Serbia sold control of NIS to Gazprom and Gazprom Neft in 2008 for €400 million ($433mn). Now, as negotiations stall, the option of temporary nationalisation is resurfacing. Once ruled out to preserve bilateral relations with Russia, the move is now under renewed consideration as Belgrade seeks to secure the country’s energy stability.
