Bulgaria Allows Russian Refinery Exports Despite EU Ban

Sofia, Bulgaria (AP) — Bulgaria will allow Black Sea refineries owned by Russian oil companies to continue operating until the end of 2024 and export petroleum products to the EU. oppose bloc sanctions.

The Sofian government estimates that the Bulgarian-Russian-owned Lukoil deal will add another €350 million ($1) to the Bulgarian budget.

“We have achieved something very important. From January 1, 2023, Lukoil will transfer all production, income and taxes to Bulgaria and not to the Netherlands or Switzerland as before. ” said Bulgarian Deputy Prime Minister Hristo Alekseev. After a meeting with the management of a Russian oil company.

The deal also benefits Lukoil and allows the Bulgarian facility to partially circumvent the EU embargo on most Russian petroleum products.

Chief Executive Irshat Sharaftdinov warned that “if exports are curtailed, refineries will not work.”

The Balkans’ only refinery is the main source of gasoline and diesel fuel sold on the Bulgarian market, but half of its production is for export.

It contributes about 9% of the country’s economic output and employs thousands of people. Shutdowns, in addition to the loss of refining capacity, pose serious problems for the labor market.

In June, the EU banned the purchase, import or transfer of Russian crude oil from 5 December and other refined petroleum products from Russia from 5 February.

Bulgaria received the exemption and will be able to continue importing crude oil and petroleum products by sea until the end of 2024. However, petroleum products produced in Bulgaria from Russian oil cannot be exported.

Officials in EU member states claim that the petroleum products they export come from Bulgaria.

Deputy Finance Minister Lyudmila Petkova said on Monday, referring to Russia’s export-grade crude oil, that “petroleum products derived from Ural oil come from Bulgaria and can be exported.”

The Bulgarian government claims the export ban will have a negative impact on the country’s economy, as deficits accumulate in the domestic market after Lukoil’s refineries cease production.