European Commission proposes Hungary, Slovakia use unreliable Croatian route to receive oil - Hungarian FM
MOSCOW. Aug 2 (Interfax) - European Commission Executive Vice President Valdis Dombrovskis has replied to Hungary's and Slovakia's inquiry regarding the halting of oil supplies from Russia's Lukoil across Ukraine, saying that Ukraine is not endangering oil supplies to those countries and proposing that they use an alternative supply route via Croatia, Hungarian Foreign Minister Peter Szijjarto said on social media.
However, Croatia "is not a reliable transit country," Szijjarto said. "It is unreliable because, with the start of the war, the fee for oil transit has been increased five-fold compared to the average market figures," he said.
Apart from this, no appropriate investment has been made in increasing the oil supply route's capacity, and its declared maximum capacity has not been proven, he said.
In July, tightened sanctions on Lukoil last month, thus effectively banning oil transport to Central Europe across Ukraine via the Druzhba pipeline. Lukoil is a major supplier to Hungary, where it accounts for around one third of crude imports, and to Slovakia with 40%-45%.
Hungary and Slovakia jointly appealed to the European Commission to start consultations on the matter, warning that if no solution is found, the case could be taken to an arbitration court, which could affect agreements between the EU and Ukraine.
On Thursday, European Commission spokesperson Balazs Ujvari said that according to the commission's information and the undertaken analysis, Ukraine's sanctions on Lukoil will not affect oil transit through the Druzhba pipeline if the owner of the oil is not the Russian company.
"I can confirm that the commission services have preliminarily concluded that urgent consultations [on oil supply to Hungary and Slovakia] do not appear to be warranted at this point in time as there is no current indication of an immediate risk to the security of supply," Ujvari said.
European Commission Executive Vice President Valdis Dombrovskis discussed the issue with Ukrainian Prime Minister Denis Shmygal, Ujvari said. The exchange of opinions was followed by a second letter to Hungary and Slovakia to explain the preliminary analysis and encourage both to provide the European Commission with more detailed information.
In turn, another European Commission spokesperson Adalbert Jahnz said that "the preliminary analysis that we have would indicate that in July the missing volumes from Lukoil were replaced by different suppliers through the same Druzhba pipeline, and as we have already said there are other alternatives for Hungary and Slovakia which include possible increases in imports from [...] a pipeline from Croatia which has adequate supply capacity for both countries' volumes."
"This is very much a preliminary analysis and we continue to be in discussion with those countries [...] we have made enormous strides in diversification of our oil supplies and overall Russian crude oil now represents about 3% of EU's crude oil import," Jahnz said.