MOL Orders Alternative Oil to Supply Hungary, Slovakia Refineries

Hungary's MOL group has ordered tankers delivering Saudi, Norwegian, Kazakh, Libyan and Russian oil to supply its Hungarian and Slovak refineries and halted diesel supplies to Ukraine as it scrambles to overcome an outage of the Druzhba pipeline, officials said on Wednesday.

MOL's refineries, the last in the EU to receive Russian oil through Druzhba, have struggled since a supply halt that Ukraine says was due to a Russian attack that damaged the pipeline infrastructure on January 27.

The refineries plan to start tapping state oil reserves, with the Slovak government approving on Wednesday a loan of 250,000 tonnes.

Both countries have blamed Ukraine for delaying restarting the flows for political reasons.

Hungary and Ukraine have had poor relations, and Slovak Prime Minister Robert Fico again accused Ukraine on Wednesday of blackmail with the aim of overturning Hungary's opposition to Ukraine's EU entry.

MOL ORDERS MORE OIL VIA ADRIATIC PIPELINE

MOL has started ordering more oil through the Adriatic pipeline from Croatia's port of Omisalj, and was finalising a contract with Croatian pipeline operator JANAF.

“The procurement of REB (Russian Export Blend) and alternative crude oils from Saudi Arabia, Norway, Kazakhstan, and Libya is currently underway," MOL said in an emailed response to Reuters' questions.

MOL's Slovak unit Slovnaft's Chief Executive Gabriel Szabo said the company would start drawing the state loan next week to secure limited operations over the next month, and contracted seven tankers of non-Russian oil to Croatia that would allow it return to full capacity from April.

Hungary said on Wednesday it and Slovakia have also asked the European Commission to enforce a rule that allows them to buy Russian oil via maritime routes if pipeline deliveries are not possible.

This would be the same alternative route through Croatia, whose economy ministry has said its pipeline could carry more oil but it should not be Russian.

BLAMING UKRAINE

Hungarian Prime Minister Viktor Orban, who opposes Ukraine's plan to join the EU and faces a tough election in April, said in a post on Facebook: "Ukraine is blackmailing Hungary, it has stopped oil flows on the Druzhba pipeline, we need to tap the strategic reserves."

Slovak Economy Minister Denisa Sakova told a news conference Ukraine has repeatedly delayed the expected restart of supplies.

Slovak's Fico echoed Orban's comments about suspected political blackmail, saying that if it is true, Ukraine would lose the country's support for its EU accession.

OUTAGE DUE TO ATTACK, UKRAINE REITERATES

A Ukrainian foreign ministry spokesperson reiterated its stand, saying: "The cause for the stoppage is Russian drone attack, Ukraine is a reliable transiter."

Fico said Slovak intelligence showed the damaged installation in the town of Brody had been repaired, adding that Slovak representatives demanded to see the pipeline installation.

Slovnaft exports fuel to neighbouring countries, including the Czech Republic, Hungary and Ukraine, and cutting exports is a key measure it is taking to keep the domestic market supplied.

Hungary said it would also stop diesel exports to Ukraine, pending the Druzhba outage.

(Reuters)