Russia's Transneft says Ukraine halted oil flows to Europe over payment issue

# 09 August 2022 15:50 (UTC +04:00)

Ukraine has suspended Russian oil flows to southern Europe since Aug. 4 because Western sanctions meant it did not receive transit fees from Moscow, Russia's pipeline monopoly Transneft said on Tuesday, APA reports citing Reuters.

Transneft said it made payments for August oil transit to Ukraine's pipeline operator Ukrtransnafta on July 22, but the money was sent back on July 28 as the payment did not go through.

Gazprombank, which handled the payment, said the money was returned because of European Union restrictions, Transneft said in a statement.

Russia normally supplies about 250,000 barrels per day (BPD)via the southern leg of the Druzhba pipeline to Hungary, Slovakia, and the Czech Republic.

Hungary's MOL and Unipetrol, controlled by PKN Orlen, are the main buyers of oil via the route, while Russia's Lukoil, Rosneft, and Tatneft are the main suppliers of oil.

MOL, PKN Orlen, and Ukrtransnafta did not immediately respond to Reuters' requests for comment.

Russia has already reduced gas pipeline flows to many EU members, citing problems with turbine maintenance on the Nord Stream 1 pipeline as well as sanctions against some buyers Moscow describes as "unfriendly."