In response to the latest round of US sanctions, Serbia faces pressure to sever its ties with Russian ownership in the National Oil Company of Serbia (NIS), its largest energy company. The US sanctions, imposed on January 10 by the outgoing Biden administration, target Russian oil and gas revenues, including Gazprom subsidiaries in multiple countries, specifically NIS Novi Sad, which plays a vital role in Serbia’s energy infrastructure. This development comes as part of broader measures aimed at weakening Russia’s energy sector amid ongoing geopolitical tensions.
Since 2008, Russia’s state-owned Gazprom Neft has held a majority stake of 56.15% in NIS, with Serbia holding 29.87%. Despite the Russian ownership, NIS remains a crucial part of Serbia’s economy, generating €3.3 billion in revenue last year, which accounts for 4.5% of the country’s GDP. However, the US has made it clear that for Serbia to avoid further sanctions and reduce risks, it must completely divest Russian interests from NIS.
Serbian President Aleksandar Vučić has stated that Serbia has 45 days to resolve the situation. The US Assistant Secretary of State, James O’Brien, emphasized that the risk of sanctions will only be fully mitigated if Serbia removes all Russian ownership, noting that Serbia’s future lies in stronger ties with European and American businesses. O’Brien also pointed out that Russia’s acquisition of NIS was done at a very low price, yet it has likely siphoned billions of euros from Serbia in recent years. Critics of the 2008 deal argue that Serbia sold a significant stake in its energy sector too cheaply—€400 million plus a promised €550 million in investment.
Vučić has previously hinted at the possibility of Serbia “taking over” NIS, and although he suggested that Serbia could afford to buy out the Russian stake without borrowing, he indicated that such a move would end up benefiting Russia financially. The situation underscores the growing tension between Serbia’s aspirations to align more closely with the European Union and the economic and political influence of Russia in the region.
As the deadline looms, Serbia must navigate a delicate balance between addressing Western pressure and preserving its economic interests, while also considering the geopolitical implications of further distancing itself from Russia.
