The United States is expected to grant Serbia a fifth postponement of sanctions against its Russian-controlled oil company Naftna Industrija Srbije (NIS), a Serbian official told Reuters on July 28, just a day before the current waiver is due to expire.

The one-month delay comes as Belgrade presses Washington for a longer exemption to protect its energy security and economic stability. NIS operates Serbia’s sole oil refinery in the town of Pancevo outside Belgrade, which supplies most of the country’s fuel needs.

The US Treasury’s Office of Foreign Assets Control (OFAC) initially imposed sanctions targeting Russia’s oil sector in January as part of broader efforts to curb Kremlin revenue amid the war in Ukraine. Gazprom Neft, which holds a 44.9% stake in NIS, was ordered to divest its share within 45 days. In response, the company transferred a 5.15% stake to its parent firm Gazprom in February in an attempt to avoid direct sanctions. However, NIS remains listed on OFAC’s Specially Designated Nationals (SDN) list.

Energy Minister Dubravka Djedovic Handanovic confirmed on July 24 that Serbia had submitted a formal request to OFAC seeking a 180-day extension, arguing that sanctions would severely disrupt fuel supplies not just for Serbia but for much of the Western Balkans. NIS imports roughly 80% of its crude oil via Croatia’s Janaf pipeline, while the remainder is sourced domestically.

“We are in an unenviable situation between two great powers, Russia and America,” Djedovic Handanovic said in an interview with national broadcaster RTS earlier this month. “Negotiations are quite tough.”

Serbia, which is not a member of the European Union and has refused to align with Western sanctions against Russia, remains heavily reliant on Russian energy. The government has warned that any disruption at the Pancevo refinery would threaten both industrial output and household fuel supply.

Serbia sold a controlling 51% stake in NIS to Gazprom Neft in 2008 for €400mn ($464mn). Today, it holds a 44.9% stake. The Serbian government retains a 29.9% stake in the company, with Gazprom holding a further 11.3%.

While the new postponement will offer temporary relief, Belgrade continues to push for a more durable solution.