Serbia’s oil company NIS returned to profitability in the first half of 2026, but improved financial results have not resolved the broader strategic challenge surrounding the company. The group reported €83.5 million in net profit and approximately €300 million in EBITDA, supported by higher oil prices, favourable inventory effects and cost-control measures.
Average Brent crude prices of $92.60 per barrel provided a supportive market environment, while NIS continued its investment programme with €101 million in capital expenditure during the first six months. However, the company remained dependent on temporary US authorisations due to its ownership structure linked to Russian shareholders.
The latest operating licence was extended until 28 August, allowing NIS to continue crude procurement, refinery operations and regular fuel distribution while discussions over ownership changes continued. However, the short duration of each extension remains the main financial and operational concern.
Temporary approvals prevent an immediate disruption but do not provide the certainty required for long-term business decisions, including crude supply contracts, financing arrangements, insurance coverage, shipping operations and strategic investment planning.
NIS remains a strategically important company for Serbia’s energy security. During the first half of the year, its facilities processed 1.6 million tonnes of crude oil and intermediate products, while sales of petroleum products reached 1.4 million tonnes.
The company operates 384 fuel stations, including 327 in Serbia, making the Pančevo refinery a central element of national fuel security, state revenues and industrial supply chains. Any prolonged disruption would therefore have consequences far beyond the company’s own balance sheet.
Hydrological conditions during the summer increased the pressure. Low Danube water levels reduced river transport capacity to only 30–40% of normal levels, limiting fuel import alternatives at the same time as supply flexibility became more important.
Serbia temporarily released mandatory operational diesel reserves held by oil companies, reduced excise duties by 20% and kept state strategic reserves unchanged. These measures provided additional time, but also demonstrated how refinery operations, logistics infrastructure and sanctions exposure can become interconnected risks.
Potential ownership changes involving Hungary’s MOL Group represent one possible solution. However, the final outcome will depend on transaction terms, sanctions approvals, corporate governance arrangements and Serbia’s ability to preserve strategic influence over a key energy asset.
NIS has also agreed to sell its Romanian subsidiary and continues preparations for the divestment of its Bulgarian operations, both subject to regulatory approvals and authorisation from the US Office of Foreign Assets Control (OFAC). These exits could free capital and management resources, although they would also reduce the company’s regional diversification.
Serbia is simultaneously working to strengthen crude supply routes through Hungary. State-owned Transnafta has submitted an environmental assessment for a planned pipeline connecting Horgoš and Novi Sad, which would link Serbia with the Druzhba pipeline system and reduce dependence on the existing JANAF route through Croatia.
Procurement plans for construction and supervision services have been valued at approximately €131 million excluding VAT. The project would improve transport flexibility and route diversity, although it would not automatically eliminate exposure to Russian-origin crude if the connected supply system remains affected by geopolitical and sanctions risks.
Despite the uncertainty, NIS continues smaller-scale operational investments. Two gas-fired power plants at Banatsko Miloševo and Srpska Crnja entered trial operation following a €17 million investment. With combined capacity of 5 MW, the facilities are expected to produce around 40.5 GWh annually by using previously underutilised field gas resources.
These projects improve operational efficiency and resource utilisation, but they cannot offset the much larger uncertainty surrounding refinery continuity and ownership structure.
The central issue for NIS has therefore become the allocation of sovereign and corporate risk. Serbia requires uninterrupted refinery operations, competitive crude supply routes and secure fuel reserves, while any future shareholder will require stable governance, sanctions protection and predictable access to international markets.
A lasting solution will need to address ownership structure, board control, supply agreements, banking access, insurance arrangements and emergency inventory mechanisms simultaneously.
The operating licence itself is not the fundamental problem. It is only the mechanism through which a broader ownership and geopolitical issue is affecting one of Serbia’s most strategically important energy companies.
