Hungarian oil company Mol says it can drop Russian crude – Bloomberg

Hungary's sole oil refiner Mol Nyrt. has announced that it has an alternative to Russian crude.

Source: Bloomberg citing a statement from Mol Nyrt. before a meeting between US President Donald Trump and Hungarian Prime Minister Viktor Orbán on sanctions against Russian oil

Details: Mol Nyrt., which operates refineries in Hungary and Slovakia, said that the pipeline from Croatia can effectively replace most of its oil supplies if Russian deliveries through the Druzhba pipeline via Ukraine stop.

In its earnings report, the company said that, if crude flows via the Druzhba pipeline drop significantly, it can increase use of the Adriatic pipeline and cover about 80% of the needs of its refineries, "although entailing higher technical risks and logistics costs".

Bloomberg reports that this statement marks a pivot after months during which both Orbán and Mol have said that Hungary has no alternative to Russian crude.

Quote: "Until now, the Orbán administration and Mol have consistently played down the potential role of the Adriatic pipeline for crude supply, arguing that Hungary's landlocked status made Russian the only effective source."

More details: There has also been an ongoing dispute about the Croatian line's capacity.

Hungary has increased purchases of Russian crude since Russia's full-scale invasion of Ukraine, and now gets about 90% of its oil imports from Moscow.

The country has secured a temporary exemption from European Union sanctions and has benefited from lower prices for Russian energy, which Bloomberg says has helped Mol expand its refining margin and boost third-quarter profit.

With the EU planning to end imports of Russian energy after 2027, Mol will in any case have to move away from Russian crude.

Quote: "The question is how much time [the company] will have to do so as a result of the US sanctions. Mol said that it's 'cautiously progressing' with the upgrade of its refineries in Hungary and Slovakia to boost processing capacities of non-Russian crude."

Background:

• Hungarian Prime Minister Viktor Orbán has said earlier that he intends to explain why Hungary is dependent on Russian energy supplies when he meets with US President Donald Trump.
• The United States imposed sanctions on Rosneft and Lukoil, Russia's largest oil companies, and their subsidiaries.
• US Treasury Secretary Scott Bessent has said the White House measures against Rosneft and Lukoil could cut Moscow's oil revenues by up to 30%.

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