Serbia Faces 'Lights Out' As US Denies Sanctions Waiver To Russian-Owned Oil Refinery
In the wake of the recent US sanctions on Russia's two biggest energy giants, Serbia is in desperate need of a sanctions-waiver if the country hopes to keep the lights on.
Serbia's government is this week warning it could slide into a severe energy and economic crisis unless Washington grants a 90-day exemption from US sanctions. Officials are essentially begging for enough time to enable the Abu Dhabi National Oil Company (ADNOC) to take temporary control of the country’s only refinery, NIS, as it finalizes its purchase of Russia’s majority share.
The US sanctions had cut NIS, which is part of Russia's Gazprom Neft, off from US dollar transactions and blocked crude shipments that normally arrive through Croatia. This has left the 4.8-million-ton refinery operating at a fraction of its capacity. Crucially, NIS produces around 80% of Serbia’s refined petroleum products, filling fuel needs across various vital sectors, including aviation and diesel.
Belgrade officials are seeking a three-month grace period for the plant to resume under the Gulf-based non-Russian operator, without which Serbia risks a chain reaction of fuel shortages and industrial disruptions. This could be politically destabilizing, leaders have warned.
Washington has already granted similar, and some might argue more extensive, waivers to nearby EU members Hungary, Romania, and Bulgaria.
President Aleksandar Vučić’s government has also long been seen as one of the Trump White House's closest partners in the Balkans. As of Tuesday he met with energy ministry officials, after which he said "We do not have good news, we did not receive a positive decision from the United States regarding NIS."
He announced that the waiver request has been denied, at least for now. "I am not only disappointed, but also surprised, because I don't see what they gained from it," the Serbian president said.
According to more via Interfax:
Serbia has made a decision to completely suspend operations at the refinery in Pancevo, and NIS will subsequently decide when it will be stopped, Vucic said.
NIS said on Tuesday evening that the Pancevo Oil Refinery had started suspending the operation of its production units due to the lack of crude oil for processing purposes as a result of the U.S. sanctions. "The activities in the Pancevo Oil Refinery during the operation suspension process are organized so as to have the refinery's units ready to restart once the relevant conditions are met, i.e. as soon as the information on crude oil availability is received. During suspension of the refinery's operations, the employees will be engaged to perform the tasks they carry out during scheduled shutdowns. NIS is continuing to supply the domestic market with petroleum products without interruption, owing to the stocks secured earlier," NIS said in a press release.
The statement added, "NIS sincerely hopes that regular operations will be reestablished in the shortest time possible in the Pancevo Oil Refinery. The company remains staunchly committed to the efforts to be removed as soon as possible from the U.S. Ministry of Finance's SDN list or to obtain a new special license which will ensure its unhindered operation, in which course of action it is strongly supported by the Republic of Serbia's authorities."
Belgrade is likely growing frustrated and running out of patience, also given Vučić has already aligned himself with Washington on policy toward Ukraine, despite Slavic Serbia being historically seen as an ally of Moscow.
Serbia has even supplied significant quantities of arms to Ukraine forces since the start of the war. This is why the Kremlin previously charged that Serbia had "forgotten who their real friends and enemies are."
Tyler Durden
Wed, 12/03/2025 – 05:45