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Shkruar nga PamfletiRecent American measures against Vladimir Putin's war machine in Ukraine have triggered unexpected reactions that have upset order in a region that has been the center of a power struggle between East and West for centuries.
Sanctions against the Russian oil industry imposed by the US last month have dealt the biggest blow to the Kremlin's economic footprint in the Balkans in decades.
It's something few people could have predicted, even recently.
Lukoil bought the Neftohim refinery, now Bulgaria’s largest company, in 1999. Meanwhile, Serbia that year found itself isolated after NATO intervened in the country’s war in Kosovo. Russia became a key ally in supporting Serbia’s refusal to recognize Kosovo’s independence. Within a decade, Gazprom had become the majority owner of Serbia’s oil and gas company NIS.
But recent American measures against Vladimir Putin's war machine in Ukraine have triggered unexpected reactions that have upset order in a region that has been the center of a power struggle between East and West for centuries.
In Bulgaria, the government seized Lukoil’s assets in a country that once enjoyed close ties to Moscow, as I reported this week with my colleagues Slav Okov in Sofia and Misha Savic in Belgrade. The decision gave Neftohim a reprieve to continue operations until April while a buyer is sought.
The situation in Serbia is still unresolved. President Aleksandar Vučić wants to avoid nationalizing NIS. But with oil available for only a week before he has to use state reserves or buy at a higher price, he may not have much choice. A solution could come as early as this weekend.
The decline of Russian economic power in the region seems irreversible, even if its war in Ukraine is resolved and sanctions against the aggressor are potentially lifted. With this influence gone, Moscow will have to seek alternative ways to exert influence in the Balkans.
The region and ties to the Kremlin
In Hungary, Prime Minister Viktor Orban's preparations for a financial market meltdown are perplexing investors who see few signs of an imminent collapse in one of the world's best-performing emerging markets. Meanwhile, property prices rose further and the central bank warned of overheating.
In the Czech Republic, billionaire Daniel Kretinsky, one of the continent's most prominent deal brokers, sought to reduce his exposure to the United Kingdom and the European Union by taking a stake in the major oil company TotalEnergies, which has assets around the world.
In Slovakia, the country's dominant power company, Slovenske Elektrarne owned by Kretinsky, plans to issue more bonds after entering the market for the first time in 14 years.
Poland, with Prime Minister Donald Tusk saying two Ukrainians working for Russian intelligence were responsible for an explosion that damaged a key rail link for shipments and travel to Kiev. Kaja Kallas, the EU's top diplomat, told a Bloomberg event that such incidents should be considered terrorism.
As for Ukraine, the EU has proposed financing the country with a 90 billion euro ($104 billion) grant or a loan backed by EU debt if the countries cannot agree on a preferred plan to use frozen Russian assets. Meanwhile, Russia hit Ukraine with a massive missile and drone attack, killing at least 20 people, as Washington and Moscow discussed a peace plan.
Poland's transformation into a $1 trillion economy has brought with it a huge increase in wages compared to other countries. This is now being felt in the labor market in Krakow, a city that has been a magnet for jobs in business services. Along with the automation of some roles with artificial intelligence, many international firms that expanded are now cutting jobs.
As Bulgaria figures out what Lukoil will do in the country, another network of red and white gas stations is poised to enter a new era. Poland’s Orlen, the region’s largest oil company, is accelerating the rollout of charging points for electric vehicles. It’s a response to growing demand: Electric vehicle sales in Poland are growing faster than anywhere else in the EU. With newspapers and groceries, gas stations have for years sold more than gasoline. Orlen now plans to lead the way in electricity sales./ Bloomberg
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