Ukraine stopped the transit of oil from Russia to the Czech Republic, Slovakia and Hungary

On August 4, the operator of the trunk oil pipeline system of Ukraine, Ukrtransnafta, stopped pumping oil from Russia to Hungary, the Czech Republic and Slovakia through the world’s longest oil pipeline, Druzhba. This was announced today by the press secretary and adviser to the president of Transneft, Igor Demin.

According to him, the reason for stopping the transfer of oil is the inability of Russia to pay for the transit due to the imposed sanctions. “At the same time, transit through Belarus in the direction of Poland and Germany continues,” Demin told RIA Novosti.

The main objective of the EU oil embargo is to deprive Russia of oil revenues. However, due to European sanctions, global oil prices will rise, resulting in the worst-case scenario where Russia’s revenues will remain roughly the same even as overall exports decrease. This is what Igor Yushkov, an expert from the National Energy Security Fund, said for “Vechernyaya Moskva”, commenting on the sixth package of EU sanctions.

Igor Demin explains that “Ukrtransnafta” provides oil transportation services on the condition of 100% prepayment, but after the payment is made, the money is returned to Transneft’s account. “Gazprombank” reported that this happened due to the entry into force of the sixth package of EU sanctions.

“We have informed the Russian Ministry of Energy, as well as the Russian forwarders supplying resources to Hungary, the Czech Republic and Slovakia and Ukrtransnafta, that the payment cannot be made,” Demin said.

At the end of May, the European Union agreed on the sixth package of sanctions against Russia, which includes a ban on the export of 2/3 of Russian oil to the EU. Thanks to it, the EU plans to give up 90% of oil imports from Russia by the end of this year. The Financial Times newspaper reported that in July European governments eased efforts to restrict trade in Russian oil.

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