Slovakia, Hungary say Ukraine has halted Lukoil's Russian oil transit

Prague/Budapest: Slovakia and Hungary said they have stopped receiving oil from key supplier Lukoil, after Ukraine imposed a ban last month on the transit of resources from the Russian energy company via its territory.

The move highlights the volatile nature of the remaining Russian oil supplies to Europe via the Soviet-built Druzhba pipeline, the last major functioning Russian oil supply route to the continent.

Both Slovakia and Hungary said they were still receiving oil from other Russian companies despite a halt of supplies from Lukoil.

Lukoil declined to comment.

Ukraine's state-run energy company Naftogaz was not immediately available for comment.

Slovakia's economy ministry said on Thursday that oil deliveries from Lukoil, Russia's second-largest oil producer, have stopped flowing to Slovakia via Ukraine following the company's inclusion on a Ukrainian sanctions list.

"According to data from (Slovak oil transporter) Transpetrol, deliveries of Russian oil to Slovakia were not stopped. The problem is, according to (Slovak refiner) Slovnaft, deliveries of a concrete supplier, Lukoil," the ministry said.

It said Slovnaft had secured deliveries from another supplier, and the ministry was discussing the issue with Ukrainian partners.

Russia continues to supply natural gas to Europe via Ukraine, despite Moscow's invasion in February 2022 and the ensuing military conflict, the largest on the continent since the World War Two.

Hungary's Foreign Minister Peter Szijjarto said on Tuesday gas shipments from Russia to Hungary were flowing unobstructed through the TurkStream pipeline on the Black Sea, but crude oil was no longer transferred by Lukoil through Ukraine.

"Due to a new legal situation in Ukraine, Lukoil is no longer delivering to Hungary, and now we are working on a solution that would allow oil transit to restart as Russian oil is very important for our energy security," Szijjarto said.

Industry sources said some 1.1 million metric tons per month, or some 250,000 barrels per day, of Russian oil have been exported via Druzhba's southern spur, of which around 900,000 tons are almost equally split between Slovakia and Hungary.

Hungary's energy company MOL owns refineries in landlocked Hungary and Slovakia, both of which are fed by the Druzhba pipeline's southern spur. The refineries need major investment to diversify its Danube and Slovnaft refineries away from Urals oil.

Szijjarto said on Tuesday that a legal solution that MOL is working on would allow Lukoil to transport crude oil to Hungary through Ukraine and Belarus.