Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to Business FM on the European Commission's proposal to impose duties on Russian oil in order to encourage Hungary and Slovakia to switch to importing oil from alternative sources:
"In this case, indeed, if the amount of the duty corresponds approximately to the difference between the discount that Hungary and Slovakia receive when importing Russian oil, then they will have an economic incentive to refocus on other supplies. That is, they will be equal in price. Another thing is that for Hungary and Slovakia, in any case, it incurs great losses in terms of the overall increase in the cost of imports. Accordingly, these losses will eventually be shifted to the consumer.
In addition to the economic benefits, there is also the issue of reliability and uninterrupted supply. Even in the conditions of fighting in Ukraine, supplies from Druzhba remain the most reliable source. Any alternatives will not be available yet, because it is necessary to build logistics, negotiate with all counterparties, and this usually requires quite a long time, that is, it is not a fast process. But in general, we see that pressure on Hungary and Slovakia is increasing not only from the United States, but also from the European Commission, and, most likely, they will be forced to abandon Russian oil sometime by 2028. Many people envy Hungary and Slovakia because they have economic preferences there in the form of cheaper oil and gas, and because of this, they are therefore more competitive in the production of many goods. Therefore, neighboring countries will only be happy to introduce such duties. And I don't think they will be able to find allies and block these duties."
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