Vucic Says Early Gas Purchases Saved Serbia From Bankruptcy

BELGRADE (UrduPoint News / Sputnik - 27th August, 2022) If Serbia had not filled its gas reserves in May, it would have been unable to pay for gas and gone bankrupt amid current prices of 4,000 Euros ($3,990) per 1,000 cubic meters, President Aleksandar Vucic said on Saturday.

"Previously we purchased large volumes of gas, which we stored in Hungary, at much lower prices than today. Taking into account the current prices, what we bought at lower prices saved Serbia from bankruptcy," Vucic said.

Under the current three-year agreement with Gazprom Belgrade meets about 63% of its needs of 2 billion cubic meters of natural gas per year at the price of 800 million euros. The rest 1.2 billion cubic meters the Serbian authorities are forced to buy separately on the market, he said.

"Today's price, and you can't buy (gas) for less than $4,300 per 1,000 cubic meters, taking into account intermediaries and delivery, but we will say is 4,000 euros. Then 1.2 billion cubic meters would have cost us 4.8 billion euros. But the entire budget of Serbia is 13.

5 billion euros. Do you understand that this means bankruptcy? Fortunately, we have been stocking our reserves at a different price since May," the Serbian president said.

Vucic said on August 8 that Serbia had reached a historic maximum in terms of natural gas reserves inside the country and on the territory of Hungary, which at that time amounted to 262 million cubic meters of gas in the Serbian part of the underground storage in Banatski Dvor, and another 200 million cubic meters in Hungary.

At the end of July, the authorities introduced an unofficial state of emergency from August 1 to March 31 in connection with the global crisis and its impact on energy and food supplies.

Since 2021, energy prices in Europe have been growing as part of a global trend. After the beginning of Russia's operation in Ukraine and the adoption of several packages of sanctions against Moscow in the West, fuel prices have accelerated the growth, pushing many European governments to resort to contingency measures.