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HomeBalkansBulgaria’s New Tax on Russian Gas Alarms Hungary, Serbia

Bulgaria’s New Tax on Russian Gas Alarms Hungary, Serbia

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On Monday, Serbia and Hungary reacted sharply to Bulgaria’s decision to add an extra tax of 10.20 euros per megawatt hour on Russian natural gas transferred through the Turkstream pipeline.

With the move, accepted by the Sofia parliament on Friday, Bulgaria has taken a position against the transmission of Russian gas but risks fueling tension with Serbia and Hungary, where Russia remains the main supplier of natural gas via the Turkstream route.

Serbian President Alexander Vucic told Politika newspaper on Saturday that the decision “is a big problem for us, it would raise the price of gas drastically, by an additional 100 euros per 1,000 cubic meters of gas”.

“That should not apply to Serbia”, Vucic said, adding he will talk with Bulgarian President Rumen Radev. Radev has yet to comment on the matter but has criticised Bulgaria’s plans to diversify gas resources in the past.

Serbia’s Ministry of Mining and Energy told BIRN on Monday: “This topic will be discussed with … Hungary and Bulgaria, and Serbia will do everything to ensure that its citizens are not affected.” The ministry said that all gas storages – in both Serbia and Hungary – are full at the start of the heating season.

It added that diversification of energy is “one of the strategic goals” of Serbia and construction of the Serbia-Bulgaria gas interconnection, with a capacity of1.8 billion cubic meters of gas, is “in the final phase”. This should enable Serbia to obtain gas from Azerbaijan and the LNG terminal in Alexandroupolis in Greece.

Serbia’s concern was echoed in Hungary. “This is unacceptable. For one EU member state to jeopardise the gas supply of another EU member state is quite simply against European solidarity, against European rules,” said Hungary Foreign Minister Peter Szijjarto on Monday. He described the move as another attempt to make Hungarian-Russian energy cooperation impossible.

Szijjarto also said his government has contacted Bulgaria and Serbia and is taking steps to ensure that Bulgaria does not apply laws that would put Hungary and Serbia in a difficult situation.

From Bulgaria, there has been silence. The decision passed without any major statement from the government, in power since June and consisting of two opposing forces – the reformist duo “We Continue the Change” and Democratic Bulgaria on one side, and on the other, Bulgaria’s long-ruling GERB, backed by United Democratic Forces.

In 2019, the then GERB government under Boyko Borissov greenlighted the Turkstream project, guaranteeing revenues to Russia’s Gazprom, and isolating Ukraine.

On August 31, the Prosecutor’s office in Sofia launched an investigation into breaches in the construction of the pipeline.

In April 2022, Bulgaria and Poland cut ties with Gazprom as a result of the Ukraine war. 

In the same year, despite a change in power between the short-lived pro-Western coalition under Kiril Petkov and a more pro-Moscow interim cabinet, Bulgaria completed a gas interconnector with Greece in order to transfer gas from Azerbaijan and the US. 

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