Bulgaria halts oil product exports to the EU amid US sanctions and economic challenges
In a move driven by recent US sanctions against Russian company Lukoil, Bulgaria’s parliament approved a bill on October 31 to stop the export of diesel and aviation fuel to EU countries.
The legislation exempts fuel used for refueling ships and aircraft, as well as supplies for NATO and EU armed forces.
This decision aims to bolster national energy security and stabilize the domestic fuel market amidst sanctions targeting Russian energy giants.
According to industry analysis, Lukoil owns Bulgaria’s largest oil refinery, Lukoil Neftochim Burgas, through its Swiss subsidiary Litasco, which controls a significant market share.
Additionally, Lukoil Bulgaria, a major fuel retailer, holds between 40% to 60% of the local wholesale fuel market.
The sanctions, which affect 89.97% of Lukoil’s shares via Litasco, threaten to limit the company’s operations within the global financial systems, restricting access to international banking and supply chains reliant on US dollars.
Delyan Dobrev, chair of the Budget Committee, explained that the export ban is a preventive measure to avoid market speculation and price manipulations.
He clarified that gasoline exports are unaffected by these restrictions.
Concurrently, Bulgaria and German defense firm Rheinmetall signed a deal on October 28 for the construction of a factory to produce gunpowder, 155mm artillery shells, and modern modular loading systems, worth over one billion euros, which underscores the country’s ongoing strategic military and industrial developments.