Fuels restrictions today, rate-setting meeting tomorrow, EP resolution on Thursday

HUNGARY - In Brief 21 Nov 2022 by Istvan Racz

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1. From today, MOL, essentially the only wholesaler of fuels in the country in these days, is not supplying those petrol stations, for which it is not contractually required to do so. This came after the incident that an energy supplier unit of the Friendship pipeline in Ukraine was hit by a Russian rocket a few days ago, almost simultaneously with the event that another rocket accidentally hit a farm in Poland. The pipe itself was not hurt but the flow of oil stopped for a while. Since then, the damaged energy supplier unit has been partially repaired, and oil shipments have been restored, but only with reduced capacity. Hungary's foreign ministry said that everything will be all right soon, but MOL's only refinery is reportedly working only at 60% of its capacity. MOL is saying that it is because of a technology failure that occurred in its refinery a few days ago, and they are going to repair it soon, but the local media insists that the reason is the reduced amount of imports of Russian oil through Ukraine. At present, the Friendship pipeline is the only route, through which Hungary is importing crude oil and intermediate products, not least because Russian oil is currently much cheaper than its alternatives. Hungary also has the Adriatic pipeline, through which it can import "sea oil" from non-Russian sources at a higher cost if required. Adriatic can be only a 70-80% replacement for Friendship in its current state. Its extension is currently planned in relatively short term, but the plan is to finance the required investment out of the EU funds which are currently being blocked by the EU Commission. MOL's rejection to sell fuels to all domestic petrol stations mu...