Czechia, Slovakia and Hungary appear to have won a carve-out from planned EU sanctions against exports of Russian oil because of their continuing heavy dependence on Russian supplies. Hungary had threatened to veto the sanctions unless it got its way and has still not fully signed up to the plans. Slovakia is also still pushing for a longer transition period.
On May 4, Reuters reported that Czechia joined Slovakia and Hungary and is also seeking an exemption period to the EU embargo on Russian oil. It is reported that they will be allowed to buy Russian oil exports until the end of 2023, while other states have to cease crude deliveries in six months.
Bulgaria is also reported to be seeking a temporary exemption from the planned full embargo on import of Russian oil to the EU if such an option is provided.
Slovakia is dependent on Russia for virtually all its needs, while Hungary is around 65% dependent and Czechia 30%. Bulgaria's Lukoil-owned refinery supplies 60% of the country's needs. The countries' refineries are adapted to use high-sulphur Russian crude and processing of different types of oil for them is not immediately possible.
The EU will sanction all Russian oil imports, both crude and refined and both oil delivered by ship and pipeline, but the ban will be “phased in in an orderly way,” EU President Ursula von der Leyen told the European Parliament on May 4. The sanctions will be phased in over the next year with crude deliveries banned in six months and refined productions by the end of the year, von der Leyen said.
"We are ready to support this decision [on sanctions including oil], given the Czech Republic will have some postponement until capacity is increased in oil pipelines which can deliver oil to the Czech Republic," said Czech Prime Minister Petr Fiala, as quoted by Reuters, adding that Czechia is trying to get a postponement for two or three years.
Fiala said that Czechia is seeking to increase the capacity of the TAL pipeline (from Italy through Austria to Germany). Fiala will discuss this with German Chancellor Olaf Scholz during his visit to Germany this week.
"The Czech Republic will face a serious problem if an embargo is imposed on imports of Russian oil and products into the EU. Not only drivers will suffer, as fuel will become more expensive again, but also [Czech] industry. The Czech Republic does not have a satisfactory solution for the complete replacement of Russian oil," said analyst Lukas Kovanda, according to iDnes.cz.
Slovakia's Economy Minister Richard Sulik said Slovakia will seek an exemption from any embargo of Russian oil agreed by the EU countries, and will request a longer transition period for oil transported by pipeline.
Slovakia receives almost all of its imported crude from Russia via the Druzba pipeline. "If it comes to an approved embargo of Russian oil as part of a further package of sanctions against Russia, then Slovakia will request an exemption," the Slovak economy ministry said to Reuters.
Slovakia's Prime Minister Eduard Heger told the BBC that the country isn't ready to give up supplies of Russian energy commodities at the moment, but it's doing everything it can to become less dependent on Russian gas.
According to him, the Slovak government is doing everything possible to disconnect Slovakia from Russian gas and oil as soon as possible. Together with Poland the country is working on a Slovak-Polish gas pipeline which is technically almost complete.
An alternative to Russian gas could be liquefied natural gas, Heger said. "We could transport it via infrastructure to Slovakia. However, we are landlocked, which is why we are such strong advocates of unity and solidarity," he was quoted by the Slovak News Agency as saying.
The Slovak government has so far refused to give a straight answer to speculation earlier last week that the state-owned energy company SPP has agreed to open a ruble account with Russia's Gazprombank. It could then put money for Russian gas in euros into its euro account and this could be converted by the bank into rubles in its ruble account before being transferred to Gazprom. This would in effect be paying for Russian gas in rubles, circumventing EU sanctions.
Heger only told the BBC that "[for gas] we will pay in euros".
The European Commission has said that payment should be made in euros, the transaction should be declared complete, and then it is up to the Russian side to convert the payment into euros.
The Slovak government has a few weeks to clarify its approach as its next payment for Russian gas is not due until May 20.