Serbia warned on October 21 that the European Union’s decision to halt imports and transit of Russian natural gas from 2026 poses a serious threat to its energy security, with senior politicians calling the move "catastrophic" and warning of possible supply shortages.

The Council of the European Union on October 20 adopted a plan to phase out Russian natural gas imports starting January 1, 2026, including a ban on gas transit through EU territory to third countries. A grace period for existing long-term contracts extends the ban's full implementation to January 1, 2028.

“This is a catastrophic decision for us,” Serbia’s Finance Minister Sinisa Mali said during a visit to Budapest alongside President Aleksandar Vucic. Speaking to state broadcaster RTS late on October 20, Mali warned that the EU ban, combined with US sanctions on Serbia’s oil sector, has left the country increasingly vulnerable.

“We receive gas through Bulgaria and Hungary, both EU members. If they cannot receive Russian gas, what will we do?” Mali said. “It’s a huge problem for us at the moment.”

Serbia currently relies heavily on Russian gas, receiving approximately 2.5bn cubic metres annually, primarily via the TurkStream pipeline through Bulgaria and Hungary.

Mali’s concerns were echoed by Serbia’s Minister of Mining and Energy, Dubravka Đedović Handanović, who said in a written statement that the situation was “very difficult and almost hopeless.”

“Bulgaria will not allow the flow of Russian gas through the Balkan Stream, which will also harm Serbia in the future,” she said, expressing hope that a diplomatic solution could be found.

Bulgaria, the EU’s last entry point for Russian pipeline gas, has committed to phasing out Russian flows to Hungary and Slovakia by 2027. Energy Minister Zhecho Stankov told Politico last month that Bulgaria would align with EU legislation requiring Russian gas to be fully phased out by January 1, 2028.

In response to Belgrade’s concerns, Anton Sviridenko, executive director of Russia’s Stolypin Institute for Economic Growth, told Russian state agency TASS that the EU’s new measures did not explicitly prohibit gas transit to non-EU countries.

“The document talks about stricter control and prior notification of such deliveries, not a complete ban,” Sviridenko said, suggesting that transit through Bulgaria could, in theory, continue under specific conditions.

Earlier this month, Russian energy giant Gazprom surprised Serbian officials by proposing a short-term extension to its existing gas contract, rather than finalising a new three-year deal. The current agreement provides 6.1mn cubic metres of gas per day at a delivered price of €290 per 1,000 cubic metres, well below current European market rates.

President Vucic expressed disappointment over the lack of a long-term commitment from Moscow, following months of negotiations. State gas utility Srbijagas had expected to finalise a new deal by October.

As Serbia navigates growing isolation from both Western and Eastern energy sources, officials say they are relying on international diplomacy to avoid a full-blown supply crisis.