Fire at the MOL refinery in Hungary. The media is sounding the alarm: it may disrupt supplies

According to an analysis by Erste bank, approximately 40 percent refinery processing capacity may be lost for several months, which will significantly hamper the production and export of petroleum products. MOL now faces two options: either increase fuel imports or temporarily use strategic reserves, Hungarian media reported.

Tamas Pletser, an oil and gas industry analyst at Erste, noted that the incident will have a limited impact on the Hungarian market, but Serbia may find itself in a particularly difficult situation.

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The media recalled that the Serbian energy system is already “in a critical condition”. At the beginning of October, US sanctions came into force against NIS, the Serbian oil company that manages the country's only refinery. The company was placed on the US sanctions list because Russian entities hold most of its shares.

“MOL will probably not be able to export sufficient quantities of petroleum products due to the fire, so Serbia may find itself in even greater trouble,” it added.

The situation is further aggravated by the fact that Gazprom has not extended the three-year contract for natural gas supplies to Serbia and will only supply this raw material until the end of the year. In the absence of viable alternative supplies, this poses a serious threat to Serbia's energy security, Erste said in its analysis.

Pletser noted that the authorities in Belgrade face the choice of staying “on Russia's side”, which involves the risk of a collapse in energy supplies, or turning away from Moscow and exposing the dissatisfaction of the nationalist electorate.

A fire at a refinery located near Budapest broke out on the night from Monday to Tuesday; it was extinguished after a few hours. MOL authorities and Hungarian Prime Minister Viktor Orban assured that the incident would not threaten the continuity of fuel supplies.