Ukraine to hike transit fees for Russian oil to EU – Transneft

Kiev cited the destruction of the country’s energy infrastructure as the main reason behind the decision

Ukraine will raise transit fees for Russian oil running via the Druzhba pipeline through its territory to the EU on January 1, Russian oil exporter Transneft announced on its website on Monday.

It is expected that Kiev will increase tariffs for transporting crude to Hungary and Slovakia by €2.10 per ton to €13.60 ($13.90), bringing the total hike to 18.3%.

In November, Bloomberg reported that Ukraine was mulling a tariff hike on Russian oil transit starting next year, citing a letter from Ukrtransnafta, the operator of Ukraine’s oil pipeline network. The Ukrainian operator had attributed the need for the price hike to the “continued destruction of Ukrainian energy infrastructure” which had resulted in “a significant shortage of electricity, an increase in its costs, a shortage of fuel, and spare parts.”

Transneft spokesman Igor Demin confirmed to the Russian media that the company had received the letter and was studying it.

Ukrainian oil transit fees have already been raised twice this year. The last hike in April reportedly brought the total increase to 51% on an annual basis.

Druzhba, one of the longest pipeline networks in the world, carries crude some 4,000 km from Russia to refineries in the Czech Republic, Germany, Hungary, Poland and Slovakia.

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