The Czech Republic has witnessed a significant increase in the utilization of Russian oil during the first half of this year, with approximately 65% of the country’s oil imports sourced through the Russian Druzhba pipeline. This marks a substantial rise compared to the previous year’s 56% and even lower figures in earlier years. The announcement came from Barbora Putzová, the spokesperson for the state-owned company Mero, as reported by the Czech News Agency. Consequently, the proportion of Russian oil in the Czech Republic’s oil imports is now at its highest point since at least 2012.

This development is noteworthy given that the European Union (EU) imposed a ban on oil imports from Russia last year. However, the Czech Republic holds an exemption that allows the use of the Druzhba pipeline for oil transportation. Mero is responsible for the ownership and operation of the Czech portion of the Druzhba pipeline, in addition to the IKL pipeline, making it the sole entity responsible for oil transport to the Czech Republic.

Recent months have seen a steady increase in the share of Russian crude oil in the country’s total imports. This trend is not unique to the Czech Republic, as analysts have been cautioning that EU refiners were seeking additional crude oil due to concerns about potential disruptions in the transit of crude through Ukraine.

Oil supply to the Czech Republic primarily comes from two sources: the Druzhba pipeline, which imports oil from Russia, and the IKL pipeline from Germany, connected to the TAL pipeline from Italy. Throughout 2022, approximately 7.4 million tonnes of crude oil were transported through these pipelines to Czech refineries, representing a roughly 7% year-on-year increase.

It’s worth noting that these increasing oil imports through the Druzhba pipeline are occurring despite the sanctions imposed on Russia due to the invasion of Ukraine. While the EU’s ban on Russian oil imports took effect in December of the previous year, imports via the Druzhba pipeline have received temporary exemptions from this embargo, given its critical role in supplying oil to several European countries.

In response to these developments, a group of protestors in Prague recently called for reduced Russian oil imports into the Czech Republic and government intervention to decrease oil supplies from Russia. However, the Ministry of Industry and Trade noted that finding an immediate replacement for Russian oil supplies is not currently feasible.

Looking ahead, the Czech Republic is actively working to reduce its reliance on Russian oil. Mero initiated design work to expand the capacity of the European TAL pipeline in July of this year, with a 1.6 billion Czech koruna project aiming to augment the country’s capacity by four million tonnes of oil annually starting from 2025. This expansion is intended to make the Czech Republic less dependent on Russian oil, as the TAL pipeline sources oil from multiple countries, including the Caspian and Black Sea regions, the USA, and Africa. Mero has held a 5% stake in the TAL pipeline since 2012.

In addition to oil, the Czech Republic has historically relied on gas supplies from Russia. However, since last year, the EU has begun to restrict Russian gas imports as part of its anti-Russian sanctions, with Norwegian gas and liquefied natural gas (LNG) replacing Russian supplies.

Article by Prague Forum