A new package of European Union sanctions will come into force on May 15, which will ban the transport of oil not only from Russia, but also from Russian companies operating on the territory of the EU. This endangers the supply of gas to Serbia, but also to the entire region of the Western Balkans. Although an agreement with the EU has been announced, which will exempt Serbia from the agreement, several other solutions are on the table, including nationalization or the sale of property to a third party.
Although the sanctions apply to the whole of Europe, Belgrade is in a much more difficult situation than the countries of the region. Serbia is the only country in Europe that is 100 percent dependent on Russian gas and oil, and the majority control package over NIS is controlled by the Kremlin.
That there is a big headache with the Serbian authorities is confirmed by the last interview of Aleksandar Vučić, which he gave on RTS on Thursday night, where he said that there is great pressure in front of Serbia.
“They tell us, ‘Do you know we’re deciding whether to exempt you from the oil sanctions package?’ “To translate, the EU has made a decision that accidentally refers only to Serbia, according to which we can import oil until May 15,” Vucic said anxiously.
The latest information that has reached the moment of publishing the text is that Serbia will most likely make an agreement with the EU, which would exclude us from the new package of sanctions. This can be a temporary solution, and we discussed the long-term options with experts who monitor the situation in energy policy.
Economist Mihailo Gajic predicts that Serbia will face several scenarios – nationalization, purchase of two percent of shares from Gazprom, purchase of 100 percent of shares or an agreement with the EU.
“The first scenario is to buy a package of shares so that the state becomes the majority owner of NIS, so that is the two percent that are missing for us to become owners. The second option meant that Gazprom would sell all its shares to Serbia, which would allow us to fully control the oil industry in Serbia, “Gajic underlined.
He emphasizes that there is another option, and that is pure coercion.
“That would mean nationalizing the property to a package of actions that would be acceptable to everyone, but that brings with it a great potential for conflict with Russia.” If that happens, we will almost certainly have problems when procuring gas from this country, and we are still only procuring gas from Russia. What is certain is that we choose the least bad solution of all the bad ones “, our interlocutor is clear.
Gajic believes that Russia will not be ready to sell us the remaining package of shares, and he sees a potential solution in the agreement with the EU.
“A possible agreement with the EU on the exclusion of the Western Balkans from this package of sanctions can be a good solution, and I think that such an agreement is realistic.” Some agreements have already been made, but that means that Serbia will have to fully adjust its policy with the EU. That terrain is already being prepared and I am almost certain that we will make that turn, which will send a signal to the EU that we are with them, which further means that there will be no sanctions “, concludes our interlocutor.
Energy expert Miodrag Kapor emphasizes that the real possibility is for Serbia to buy a majority package of shares from Gazprom.
“Our oil refinery processes Ural oil, which is mostly imported from Iraq. There is still a danger that the Adriatic oil pipeline will not be able to be transferred if sanctions are imposed on Gazprom. “One of the realistic options after that is for our NIS to become the property of the state of Serbia or a third party in order to continue the traffic,” Kapor told Nova newspaper.
He points out that such transactions represent political agreements, and that this problem will be solved at that level.
“There are different relations in politics than purely economic ones, but if we look rationally at the situation in which the European Union and Serbia find themselves, there is no logic for Russians to hold majority ownership of NIS.” I think that would be a move of desperation if the change of the ownership structure is not allowed “, added our interlocutor.
Kapor explains that the European Union is “overwhelmed” by flirting between Serbia and Russia.
“There is a considerable determination from the EU, but also from the United States, that Serbia should no longer be looked down upon when cooperating with Russia, which means that we will have to harmonize our policy with that of Europe,” our interlocutor concluded, Nova writes.
