site.btaDeputy PM Vassilev: Bulgaria to Seek Temporary Exclusion from EU Russian Oil Embargo

If the European Commission envisages any exceptions, Bulgaria will ask to be temporarily excluded from a proposed EU embargo on Russian oil, Bulgarian Deputy Prime Minister and Finance Minister Assen Vassilev said on Wednesday in an interview for www.capital.bg. Hungary and Slovakia are also expected to opt out of the measure.

Vassilev specified that "we would like to benefit from such exceptions because this is in the best interest of Bulgarian consumers, Bulgarian transport carriers and the Bulgarian people as a whole" because Bulgaria can cope, in purely technological terms, without Russian oil, but this would send fuel prices soaring.

Krassimir Parvanov, who represents the Bulgarian State on the Supervisory Board in Lukoil Neftochim, told www.mediapool.bg that the Burgas-based oil refinery will have to suspend operations if the EU bans the import of Russian oil and petroleum products.

The refinery relies on Russian Urals oil for 50 to 60% of its inputs, and the rest come from Saudi Arabia, Kuwait and other sources. Parvanov is adamant that Lukoil Neftochim is technologically unable to function without Russian oil, but it can keep working if the embargo is partial and Russian deliveries drop to even 10% of the total.

Parvanov recalled that Switzerland-based LITASCO is responsible for finding inputs for the facility and handles the pricing of both its inputs and outputs. He noted that for the time being deliveries arrive on a regular basis and the refinery has a certain reserve of crude. 

Mediapool quoted Bulgarian Oil and Gas Association Executive Director Andrey Delchev as saying that the Burgas refinery now supplies some 60-70% of the fuel on the Bulgarian market. "It would be logistically difficult to replace such a large percentage and will require all sorts of alternative sources," he pointed out. 

Delchev said that most Bulgarian filling stations buy fuel from Lukoil because it is cheaper and transport costs are lower. He was unaware of what fuel stocks Lukoil holds and how long the refinery can keep working if Russian oil deliveries stop.

Lukoil Neftochim has not yet come up with an official position on the European Commission's oil embargo proposal.