Serbia is in advanced negotiations with Russian energy giant Gazprom over a new long-term natural gas supply agreement, Energy Minister Dubravka Dedovic Handanovic said in an interview with Russia's TASS news agency, RT Balkans reported on August 21.

Talks are aimed at finalising a deal before the current contract, extended in May for four months, expires in September. The existing arrangement allows Serbia to receive 6.1mn cubic metres of gas daily at a discounted price of €290 per 1,000 cubic metres, significantly below current European market rates.

“Only individual elements of the future agreement remain to be determined,” Dedovic Handanovic told TASS, confident in reaching a timely conclusion.

The temporary deal has enabled Serbia to build reserves, including filling the Banatski Dvor underground gas storage and securing additional capacity in neighbouring Hungary. The minister said the continued supply of Russian gas was essential during Europe's energy crisis, ensuring uninterrupted access for Serbian households and industry.

“The most important thing is that, thanks to Russian gas, at the peak of the energy crisis, we ensured a stable supply of our citizens and the economy,” she said, according to Serbia’s Beta news agency.

Dedovic Handanovic reiterated that Russia remains a “long-standing and important partner” for Serbia in the energy sector, and said that cooperation had remained “effective and mutually beneficial” despite recent challenges.

Construction has also begun on the long-anticipated expansion of Banatski Dvor storage facility, a project previously agreed with Russian partners. “Increasing the volume of gas storage in our territory is of key importance for energy security in changing geopolitical conditions,” she added.

The energy minister also highlighted the Serbia-Hungary oil pipeline as a top priority project. With support from both Moscow and Budapest, the pipeline will link Serbia to the Družba pipeline, allowing the country to diversify its oil supply routes.

In February, Hungary announced plans to invest €320mn over three years in the project. According to Hungarian Foreign Minister Péter Szijjártó, the pipeline will span 180 km in Hungary and 120 km in Serbia, connecting the Sazhalombat refinery—Hungary’s largest, located south of Budapest—with Serbia's northern city of Novi Sad.

The project will make Hungary a key transit country for Russian oil and expand Serbia’s access to energy resources amid tightening global supply lines.

“Cooperation with the Russian Federation in the energy sector is based on long-standing trust and common interests,” Dedovic Handanovic said, adding that Serbia continues to pursue a sovereign energy policy.