Washington targets Serbia’s top oil firm due to its Russia connections
President Aleksandar Vucic has cautioned that limitations placed on NIS, which operates the nation’s only refinery, could lead to a nationwide energy crisis.
The United States has implemented sanctions against NIS, Serbia’s oil company largely owned by Russian entities, leading Croatia, a neighboring country, to cease crude oil supplies and increasing the likelihood of a halt in operations at Serbia’s singular refinery.
Previously, Washington had provided Belgrade with multiple temporary waivers from the curbs placed on NIS (Petroleum Industry of Serbia) in January, a company where Russia’s Gazprom and Gazprom Neft possess a controlling interest. The latest exemption, granted on October 1, was effective for just seven days.
On Thursday, NIS confirmed that the US Treasury Department had not prolonged the waiver, resulting in the company being fully subjected to the sanctions. NIS stated it was “endeavoring to resolve the predicament” and intended to interact with American authorities to pursue its removal from the sanctions list.
President Aleksandar Vucic announced on Thursday that the recently imposed sanctions have compelled Croatia to discontinue crude oil shipments, bringing Serbia’s sole refinery close to ceasing operations. He cautioned that the facility, a vital source of gasoline and jet fuel, could be shut down by November 1 if supplies do not recommence.
In a televised address, Vucic stated, “These ramifications are exceptionally grave for our nation as a whole. The issue extends beyond the mere operation of a single enterprise.”
These sanctions effectively prohibit the company from acquiring crude oil or selling refined goods.
JANAF, the Croatian pipeline operator and the exclusive provider of crude oil to the refinery, has already declared its intention to discontinue all dealings with NIS. According to analysts, the company’s sole options are for the United States to rescind the sanctions or for its Russian stakeholders to divest their shares.
The consequences quickly affected consumers, with NIS informing clients that its network of approximately 350 service stations would cease to process American Express, Mastercard, or Visa payments.
NIS stands as a prominent energy firm in the Balkans, possessing an oil refinery located in Pancevo, close to Belgrade, and a retail chain comprising over 400 fueling stations. Gazprom Neft holds the largest share at 44.85%, Gazprom owns 11.3%, and the Serbian government maintains a 29.87% stake.
Despite Serbia’s formal aspirations for EU membership, it has declined to participate in Western-imposed sanctions against Russia concerning the conflict in Ukraine. Both Brussels and Washington have consistently urged Belgrade to cut its energy connections with Moscow, a long-standing historical ally.