Why August 28 is crucial date for NIS and what do gas prices actually depend on?

Because of all the disruptions on the global oil market and the war between the US and Iran, it is most important for Serbia that the licenses issued by the US OFAC for the work of Petroleum Industry of Serbia, NIS, and to JANAF for the transit of oil to Serbia, which expire on August 28, are extended, in order to finally reach a solution for NIS and the exit of Russian capital from the company, says Jelica Putnikovic, editor of the portal Energija Balkana.

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"Now, NIS has ordered quantities of oil, imports both oil and derivatives, but because of everything that is happening in the Strait of Hormuz and the bombing of refineries in Russia, the price of kerosene has increased compared to diesel. These are some disturbances on the European market, there are no problems in Serbia because we have supplies, but it is very important that NIS starts functioning normally as soon as possible," she told Tanjug.

Speaking about the new attacks on tankers in the Strait of Hormuz, Putnikovic stated that although the traffic there is limited, the price of oil is still at a normal level, i.e. below the level that many would expect considering the geopolitical risk, because the market is not facing large shortages of oil.

"What many who monitor the ships sailing through the Hormuz via satellites say is that it's still not true that tankers are not passing through the Strait of Hormuz, and that of the 20 million barrels that used to pass, about 5 now pass through, that the Gulf countries have found a way to deliver oil via pipelines bypassing the strait, which means that there is no shortage of 20 million on the market. There is a situation with China, which has large reserves of crude oil and which has reduced its purchases, and India, which buys Russian oil," she stated.

Putnikovic assessed that the price of oil did not increase over 90 dollars per barrel after the new attacks in the Strait of Hormuz, because there was no large scale shortage of oil in the supply chain.

When asked how long the price can remain at the current level if the attacks on tankers continue and if the traffic through Hormuz remains limited, Putnikovic said that it is very difficult to know and forecast if and when the negotiations between the US and Iran will begin.

She mentioned that the price of oil sometimes fluctuates even after some statements made by US President Donald Trump.

There are many factors that affect the price of crude oil, it is not just the number of ships that pass through or attacks on some tankers, Putnikovic said, adding that the price of oil is certainly affected by insurance prices for those ships that do pass through that dangerous zone.

According to her, a stabilization of the price of oil can be expected, and the start of negotiations between the US and Iran, bearing in mind that US mid term elections in November are approaching.

"When it comes to alternative routes, the shortage is what it is, but the Northern Sea Route is working. This does not mean that tankers will be able to leave Hormuz and head to Europe that way, but it's about constantly finding new alternatives for the transit of any cargo because everyone cares about efficiency. Many Gulf countries are announcing construction of oil and gas pipelines, but it's too early for that because they must spend money to repair what was destroyed in the attacks," she explained.

Asked whether we can expect fuel to be more expensive in the fall even if there is no big surge in the price of oil, Putnikovic said that the price of fuel will not increase, as oil will go up to 90 dollars.

According to her, everything depends on whether the state will continue to reduce the excise tax after August 23, because it is the state that determines the retail price.

(Telegraf Biznis/Tanjug)