Ukraine resumes oil transit via Druzhba pipeline

The first crude oil deliveries via the Druzhba pipeline have arrived in Ukraine following its reopening. This was announced by the Hungarian oil company MOL in a press release on April 22. Accordingly, the Ukrainian pipeline operator Ukrtransnafta informed MOL that Ukraine would be receiving crude oil from Belarus via the pipeline system again during the course of the day. At the same time, it was confirmed that onward transportation to Hungary and Slovakia can be resumed. The force majeure regulation in force since January 27th ended on April 21st at 6 pm, after the necessary repair work had been completed. The first deliveries to Hungary and Slovakia are expected on April 23 at the latest. Utilization of strategic reserves During the interruption, Hungary drew on its strategic crude oil and fuel reserves to secure supplies and organize alternative deliveries by sea. Some of these reserves have been used over the past few weeks. Stocks had fallen to a historically low level at the beginning of April, but are now being built up again. Market observers attribute the decline to increased demand as a result of government price measures and limited supply options, among other things. At the same time, Hungary increased its imports via alternative routes, particularly via Croatia. However, the capacity of these connections remains limited. Additional challenges arose due to technical restrictions at one of MOL's refineries, which is currently not operating at full capacity. Slovakia also drew on its own reserves at times. Industry representatives emphasize that although the resumption of pipeline deliveries is helping to stabilize the situation, it has not completely eliminated all bottlenecks. The Hungarian oil association MASZ explained that the resumption of Druzhba deliveries has improved security of supply, but that potential bottlenecks in refined products may persist. In addition, industry associations pointed out that regulatory measures in Hungary could have an additional impact on demand and therefore exert pressure on supply in the short term. Political and economic dimension The interruption in supplies had also recently triggered political discussions. Hungary and Slovakia had pushed for a solution in order to secure energy supplies. In this context, questions of energy policy and European cooperation were discussed intensively. The resumption of transit is now taking place in parallel with progress on European financial aid for Ukraine, which has also been the subject of intensive negotiations in recent weeks. The reopening of the pipeline has eased the situation for the time being. Nevertheless, the supply situation in the region remains dependent on various factors, including infrastructure, market conditions and political coordination. The post Ukraine resumes oil transit via Druzhba pipeline appeared first on ostwirtschaft.de.