The sanctions imposed by the Trump administration against the Russian oil giants Rosneft and Lukoil are creating problems not only for Moscow, but also for several European energy plants in contact with or with participation of the Russian giants. Before the sanctions come into force on November 21, Romania and Bulgaria are taking action to avoid the closure of the oil refineries of the two main Russian companies. Bucharest and Sofia are putting in place legal mechanisms to temporarily transfer activities under the control of national entities.
Bulgaria’s fears caused by Trump’s sanctions
Let’s start from Bulgaria, where the situation is technically complex. The country stopped importing Russian crude oil in March 2024, switching to alternative sources. The country’s only refinery, Lukoil Neftochim Burgas, and the retailer Lukoil Bulgaria, however, fall directly under the sanctions imposed by Trump. In the Burgas plant, the largest in the Balkans, 190 thousand barrels are refined every day, thanks to a network of over 200 service stations and logistics infrastructures throughout the country. The Bulgarian authorities have adopted a series of preventive measures to deal with the possible fallout of the US sanctions on Lukoil.
The Sofia government has ensured that fuel supplies will remain guaranteed until the end of the year and has introduced legislative changes requiring state approval for the sale of the Russian company’s assets in the country. A possible closure of the Burgas refinery – which covers around 80 percent of the national fuel needs – would have significant consequences for the Bulgarian economy. The sanctions, in fact, represent a risk for the operational continuity of the plant and for the stability of the internal energy market, despite the government’s reassurances on maintaining supplies.
Sofia’s legal measures: buying and selling refinery shares
Sofia’s recent measures should be read from this perspective, including the law that allows the government to appoint the management of the Burgas refinery. According to Bulgarian broadcaster Mediapool, the measure deprives the company’s shareholders of voting and disposition rights, allowing the state-appointed administrator to approve or even sell shares in the country’s largest refinery. This is the second emergency law passed in seven weeks to address the refinery crisis, which worsened after US sanctions against Russia’s Lukoil in the context of the war in Ukraine. Back in October, Bulgaria suspended exports of refined petroleum products, including diesel. According to Martin Vladimirov, director of energy and climate at the Bulgaria-based Center for the Study of Democracy, the appointment of a special manager to temporarily take operational control of Lukoil’s activities in Bulgaria would “ensure energy security, avoid a supply crisis and proactively mitigate the risk of future or secondary sanctions.”
Finally, among the options being studied by Romania, there is also the possibility of a complete nationalization of the plant. Before adopting these technically complicated measures, Sofia considers the possibility of requesting an exemption from sanctions.
Romania aims to ease sanctions
Romania’s situation is very different: like its neighbour, it first wants to follow the path of requesting an easing of sanctions. However, Romania, home to Lukoil’s Petrotel refinery, has not yet made a formal decision. Nationalization is seen as a “last option” in Bucharest. Romania’s Energy Minister Ivan Bogdan-Gruia said the country is ready to face several scenarios, including operational management of the refinery to secure purchases of Russian oil.
The Bucharest government’s plan will aim to preserve “Romania’s economic activity, but at the same time stop financing the Russian Federation”, added the minister. The Romanian plant covers around 20 percent of the national fuel requirement and its possible closure could cause slight increases in prices. In addition to the internal impact, a possible blockade of the refinery in Romania would risk compromising exports to neighboring Moldova, with possible repercussions on the regional market.
