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Druzhba Oil Line Suspension Could Prove Significant Blow To CEE

EU-RUSSIA

Russia's state-run RIA reporting that Transneft has stated that Ukrtransnafta has stopped pumping oil through the southern leg of the Druzhba pipeline to Hungary, the Czech Republic, and Slovakia, due to 'transit payment issues' according to two unnamed sources (see 1123BST Energy bullet).

  • The southern leg of the Druzhba pipeline travels from Russia, into Belarus, then into Ukraine through to Slovakia and Hungary.
  • All of these landlocked states remain reliant on Russian pipeline oil for energy provision, fuel, and to support industry. Pipeline has a capacity of 1.2-1.4mn bpd.
  • In 2020, 78% of Slovakia's oil came from Russia, with 45% of Hungary's and 29.2% of Czechia's coming through the pipeline. The loss of Druzhba supplies could deal these countries a significant economic blow.
  • For Hungary and its controversial PM Viktor Orban, it could see louder calls for a softening of sanctions against Russia in order to secure energy supplies. Orban has already ensured carve-outs for Hungary on sanctions related to oil and gas.
Chart 1. Map of Druzhba Oil Pipeline

Source: EJA

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