Thewesternbalkans
A meeting of the Serbian government on Saturday discussed the issue of possible US sanctions against the company Naftna Industrija Srbije (NIS), of which Gazprom is the majority shareholder. On the same day, Serbian President Aleksandar Vučić received US Ambassador to Belgrade Christopher Hill, with whom they discussed events affecting Serbia and the world, as well as the introduction of US sanctions against NIS.
According to media reports, A. Vučić indicated that Serbia has enough money to immediately buy the Russian shares in NIS. “If we do it and pay the price to the Russians, the money will be directed to the battlefield… I do not understand the meaning of the sanctions, because they will have this money in Russia,” the Serbian president said.
Gazprom Neft became a shareholder in NIS in 2009, and in 2011 increased its share to 56.5%. To date, 50% of the shares are owned by Gazprom Neft. Gazprom owns 6.15%, while the state shares of Serbia account for 29.87%.
Over the years, Gazprom Neft has invested more than $3 billion in the Serbian subsidiary. The Pančevo refinery, which was almost completely destroyed during NATO bombing in 1999, has been restored. According to Aleksandar Vučić, thanks to Russian investments, the Serbian oil refining industry “rose from the ashes like a phoenix”, and Serbia has become an exporter of energy resources for the region.
Comment:
Serbia expected sanctions against NIS from the EU back in 2022, but this did not happen. Now the threat comes from the United States. American sanctions (and the UK and the EU are likely to join them) could completely block supplies from Russia. The operation of the Pančevo oil refinery will become impractical if Russian supplies are stopped. For the Serbian economy, the closure of NIS would have catastrophic consequences. According to experts, this could completely paralyze the country’s economy.
Talks about the need to nationalize NIS or sell part of the company’s shares have been ongoing since 2022, when the eighth package of EU sanctions limiting Russian oil exports was agreed. Interest in buying a controlling stake from the majority owner was shown by the Hungarian MOL. There were also rumors that NIS would be bought out by the British.
Time will tell whether the Serbian government will be able to find a way out of this situation. However, it is becoming increasingly difficult for it to maneuver between maintaining relations with Russia and threats from Western partners and pursuing an independent policy in the interests of its own country.
