Negotiations Underway for Russian Exit from Serbian Oil Firm Amid U.S. Sanctions, Says Energy Minister

Russian stakeholders involved in Serbia’s state-associated oil enterprise NIS are in discussions to exit the company as it faces newly implemented U.S. sanctions, as stated by Serbia’s energy minister on Tuesday.

The U.S. Treasury commenced sanction enforcement against NIS on October 9, following multiple delays since January, as part of former President Donald Trump’s wider initiative to exert pressure on Russia’s energy industry in light of the ongoing conflict in Ukraine.

NIS is the latest energy entity in Eastern Europe that is pursuing new ownership amidst the pressure of sanctions. Just last week, Bulgaria enacted legislation to place a significant refinery owned by Lukoil under state management, while Hungary obtained a one-year exemption from U.S. sanctions to continue importing oil from Russia.

Since 2009, Gazprom Neft and its parent company, Gazprom, have owned nearly 45% of NIS. Recently, Gazprom transferred about 11% of its shares to another Russian company named Intelligence. The Serbian government possesses just under 30% of the company.

Officials in Belgrade have expressed concerns that continued Russian ownership could jeopardize the nation’s energy security and overall economy.

Energy Minister Dubravka Djedovic reported that the Russian owners have requested an extension of NIS’s operating license from the Treasury’s Office of Foreign Assets Control (OFAC) while they negotiate with an unspecified third party. She indicated that this request “suggests that the Russian side is willing to relinquish control and influence” in the company to another party.

NIS manages Serbia’s primary refinery located in Pancevo, which meets approximately 80% of the domestic demand. The Serbian government has officially endorsed the Russian request, and Djedovic mentioned that OFAC might reach a decision this week. «We need to find a solution,» she remarked.

The company employs around 13,500 individuals and operates over 400 fuel stations throughout Serbia, along with approximately 80 in Bosnia, Bulgaria, and Romania. In 2024, NIS reported revenues of 3.3 billion euros ($3.8 billion) but incurred a loss of 153 million euros for the year.