Serbia’s sole oil refinery, Russia-owned NIS (NIIS.BEL), is set to halt operations within four days unless U.S. sanctions on the project are lifted, President Aleksandar Vucic warned in a televised address on Tuesday. The shutdown could disrupt domestic fuel supplies just as winter approaches, though the country has short-term reserves to cover immediate demand.

Vucic said the Russian owners, Gazprom Neft (SIBN) and Gazprom (GAZP), have been given 50 days to sell their stake, or the Serbian state would take over the refinery and make an offer to acquire the assets.

“Serbia is facing major problems,” Vucic said. “When you impose sanctions against Russia and its companies, they end up hitting our country.” He added that sanctions could also impact supply lines and electricity production.

NIS Prepares for ‘Hot Standby’

NIS confirmed that it has placed its Serbian refinery on a “hot standby”, allowing for a potential restart once crude oil supplies are restored. The company emphasized that domestic fuel deliveries continue uninterrupted, thanks to previously secured reserves.

The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) imposed sanctions on Russia’s oil sector, including NIS, in January. While waivers were granted earlier in the year, the sanctions came fully into effect in October. Following the measures, banks halted NIS payment processing, and crude deliveries from Croatia’s JANAF pipeline were suspended, forcing Serbia to explore alternative supply channels.

The Serbian central bank also warned it would suspend all NIS payment transactions if the refinery’s operating license was not renewed. Washington is demanding complete Russian divestment, giving NIS owners until February 13 to sell their stakes. Gazprom Neft holds 44.9% and Gazprom 11.3% of NIS, while Serbia owns 29.9%, with the remainder held by smaller shareholders.

Fuel Reserves to Cushion Impact

Vucic said Serbia currently has 55,000 metric tons of diesel and 50,000 tons of gasoline in refinery reserves, expected to last until late December. The state also maintains 184,000 tons of diesel and 19,000 tons of gasoline, with additional imports of 20,000 tons of diesel and 35,000 tons of gasoline scheduled for December and January.

Serbia remains heavily reliant on Russian gas imports via the Turk Stream pipeline, making energy security a central concern as geopolitical tensions continue to affect the Balkan country.