Hungary's MOL group is calling on Croatia’s state-controlled oil pipeline operator Janaf to provide guarantees by February 27 for the passage of Russian oil shipments arriving by sea, which are not affected by sanctions, otherwise MOL will contact the European Commission and may initiate compensation proceedings, the company told state news agency MTI

MOL stated that, under sanctions regulations, shipments of Russian crude must be permitted if the Druzhba pipeline, Hungary’s main oil supply route, is unable to operate for reasons beyond the control of the member state concerned.

The necessary official documents have already been sent to the Croatian side, and the Hungarian sanctions authority has also confirmed this interpretation, MOL added.

The company said purchases of Russian crude oil by sea are also fully compliant with US sanctions regulations and the transport and sales companies contracted by MOL are not on US sanction lists. MOL is urgently asking Janaf to confirm that it will take over a crude shipment coming by sea from Russia.

Janaf asked MOL to acquire EU and United States permits to clear deliveries, a request the Hungarian oil giant said was "unrealistic" and posed an "unjustified bureaucratic obstacle".

MOL also claims Janaf's delivery fees were 4-5 times the European average, "raising suspicion of an abuse of a monopoly position". Supply security in the region required the operation of two commercially competitive pipelines: the Adria and the Druzhba, MOL said, adding that it supports Ukrainian efforts to connect the Druzhba with the Black Sea by restarting the Odesa-Brody pipeline.

MOL said that by refusing the service, Janaf abuses its dominant market position under EU competition rules and it would be liable for any financial damages resulting from the delay. 

The ultimatum came a day after the two companies agreed start long-term capacity tests on the Adria crude pipeline with the involvement of independent, international observers.

The tests aim to determine whether Janaf's pipeline can sustain a sufficient volume of continuous, all-weather deliveries, MOL said, adding that while the Croatian side had put Adria's annual capacity at 11mn-15mn tonnes, more than 2mn tonnes had never been delivered to Hungary.

MOL has contested Janaf's claims that the Adria pipeline has enough capacity to supply its refineries.