【Text by Observers Network, Wang Kaiwen】The U.S. sanctions against the Serbian oil industry company (NIS) came into effect last month. As the only refinery in Serbia, this move has posed a significant threat to the country's fuel supply.

According to Bloomberg, on November 15, the Minister of Mining and Energy of Serbia, Handanović, stated that the firm stance of the U.S. on sanctions has placed Belgrade in a difficult situation: either take over the company from Russia or risk running out of crude oil.

"A difficult decision is before us - whether we should take over the company and provide compensation to Russian shareholders," said Handanović. She previously revealed that Washington had rejected the request for a temporary relaxation of the sanctions on NIS.

"In the coming days, we may have to make some of the most difficult decisions in our country's history," said Handanović, adding that the Serbian government will hold a meeting with President Vučić and business leaders on the 16th local time to discuss the next steps. She mentioned that options include nationalizing NIS and negotiating the compensation that Russian shareholders might receive.

According to "Russia Today RT", Gazprom and its subsidiary Gazprom Neft collectively hold 56% of the shares in the Serbian oil industry company, while the Serbian government holds about 30% of the shares.

NIS facilities NIS official website

The U.S. initially imposed sanctions on NIS on January 10 this year, requiring Russian shareholders to exit the company. However, the sanctions were repeatedly delayed until October 9, when the U.S. sanctions finally took effect. Afterward, banks stopped processing transactions related to NIS, and the main crude oil supply pipeline to the company - the Croatian JANAFA pipeline - also stopped supplying oil to it. Reuters previously reported that without new crude oil supplies, NIS could only operate until November 25.

Bloomberg commented that taking over NIS without the consent of Gazprom would mark a dramatic political shift for Serbia. Serbia has deep historical ties with Russia and still relies on Russian gas.

On November 11, Handanović announced that the Russian shareholders of NIS were willing to transfer control of the company to a third party. She stated that the Russian shareholders had submitted an application to the Office of Foreign Assets Control (OFAC) of the U.S. Treasury, requesting a postponement of the sanction implementation date during negotiations with a third party. She also pointed out that the Serbian government supported this request.

However, Handanović said on the 15th that Washington insisted on the complete withdrawal of Russia from the company.

While pressuring Serbia, the U.S. is witnessing the full-scale escalation of sanctions against the Russian energy sector. Last month, to pressure Russia to immediately cease hostilities with Ukraine, the U.S. Treasury announced sanctions on Lukoil and the Russian state-owned company Rosneft.

Bloomberg reported that Vučić is urging Russian shareholders to sell their shares rather than allowing Serbia to forcibly nationalize NIS.

During a nationwide speech on October 9, Vučić stated, "We ask our Russian partners to reconsider the impact on Serbia again and try to find solutions together with us. I am very clear that the Russian side is innocent of the sanctions, but as the president of the republic, I have no authority to allow my country to continue suffering unnecessarily, and I will never allow such a situation to happen."

"Russia Today RT" reported that the U.S. and the EU have been urging Serbia to cut close ties with Russia, but Belgrade has so far resisted. At the same time, the U.S. plans to push Russia out of the European market. U.S. Energy Secretary Chris Wright claimed in September that Washington is prepared to "replace" Russian oil and gas imports.

"This is a political war, a geopolitical war, and now we, as a small country, are paying a high price for it. I hope our Russian friends can understand the severity of the situation and help us through this crisis," Handanović said on the 15th.

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