NewsRussian pipeline halt sparks scramble for Czech oil reserves

Russian pipeline halt sparks scramble for Czech oil reserves

According to Czech media, the flow of Russian crude oil through the "Druzhba" pipeline to the Czech Republic, which accounts for 58% of the country's oil demand, has stopped. Orlen Unipetrol, the sole company in the Czech Republic that processes oil, confirmed these reports.

Oil plant in the locality of Uhřice
Oil plant in the locality of Uhřice
Images source: © via Getty Images | Bloomberg, Martin Divisek
Piotr Bera

4 December 2024 18:47

However, the reason for the supply interruption remains unclear. Czech media suggest that the lack of oil is most likely due to administrative issues.

Nothing suggests that the deliveries were halted by Russia - wrote the Novinky portal.

The Slovak refinery Slovnaft, which receives Russian raw material through "Druzhba," has not reported any issues with deliveries. Meanwhile, Orlen Unipetrol's spokesperson, Pavel Kaidl, mentioned on social media that the problem occurred on the suppliers' side.

"The current delivery has been delayed," he wrote.

The Czech Republic and the embargo on Russian oil

Kaidl emphasised that the company has a week's worth of oil reserves but wants to ensure continuity and intends to borrow crude from the state's strategic reserves.

At a Wednesday meeting, the Czech government decided to loan the company 330,000 tonnes (approximately 300,000 metric tons) of oil, which is enough for over a month of production, according to the Minister of Industry and Trade, Lukasz Vlčák.

After the start of the Russian aggression in Ukraine, the Czech Republic negotiated an exemption from the embargo on the supply of Russian strategic resources, which expires at the end of 2024. The authorities in Prague had previously announced that they do not intend to extend this period. Russian oil is to be replaced by supplies through the IKL pipeline, connecting Bavarian Ingolstadt with Czech refineries in Kralupy and Litvínov. Near Ingolstadt, the IKL connects with the trans-alpine TAL pipeline, in which the Czech Republic has stakes. Through the Alps, oil flows from the ports in Trieste.

Politico reported in October that the Czech refinery Orlen Unipetrol earned over 1.2 billion euros from importing cheaper Russian fuel. Research shows that the Czech Republic spent five times more on Russian oil than on aid to Ukraine, amounting to 7 billion euros.

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