The recent transfer of ownership of Russian oil assets in South-East Europe has significantly reshaped the landscape for refinery operations and the pricing of secondary energy commodities. This shift not only alters who controls refineries and fuel retail networks but also impacts how by-products such as petroleum coke, bitumen, and sulphur are priced and supplied. These by-products are crucial for various sectors, including construction and cement production, yet they often remain overlooked in broader energy discussions.
Historically, by-products from refining processes were cross-subsidized within vertically integrated systems, where profits from fuel sales allowed for stable domestic pricing of commodities like petcoke and bitumen. However, this paradigm is shifting as new ownership models emerge. Under European energy groups and global trading houses, these by-products are now viewed as marketable commodities rather than strategic domestic inputs, exposing them to global pricing dynamics.
A typical medium-to-large refinery in South-East Europe produces between 5% and 10% of its output as secondary products. While these volumes may seem minor compared to fuel production, their economic significance is substantial. Petroleum coke serves as a vital input for cement manufacturing, while bitumen is essential for road construction and civil engineering projects. Previously, domestic refineries ensured supply continuity at lower prices; however, with new ownership structures, this stability is being challenged.
The transition to European control has led to the elimination of implicit subsidies for by-products. Refineries are now operated as profit centers within broader international portfolios, with pricing aligned to global benchmarks. This change has particularly affected petcoke prices, which have surged due to increased demand from cement producers in Asia and the Middle East. Consequently, domestic cement plants in South-East Europe are experiencing a shift from near-cost pricing to market-linked rates.
From 2022 to 2025, delivered petcoke prices in the region are projected to increase by €30–50 per tonne based on sulphur content and logistics considerations. For cement manufacturers consuming between 200,000 and 300,000 tonnes annually, this translates into an additional operational expenditure of €6–15 million each year—a significant financial burden.
The impact of rising bitumen prices extends beyond individual companies; it affects public infrastructure projects directly. Bitumen costs can constitute up to 40% of asphalt expenses for road construction and maintenance. As new owners align bitumen pricing with international standards, domestic buyers face increased competition from Mediterranean markets. Since ownership changes began, bitumen prices in import-dependent regions have risen by 20–35%, leading to project cost increases of 5–9% for highway constructions alone.
For governments managing extensive infrastructure programs, these price hikes can lead to substantial budgetary strains. A national road initiative valued at €1 billion could see unanticipated cost overruns ranging from €50 million to €90 million due solely to bitumen repricing.
Cement producers are caught in a complex matrix of rising costs that includes not only petcoke but also electricity and carbon-related expenses. The cumulative effect results in an increase in operational expenditures for cement production by €4–7 per tonne compared to pre-crisis levels. These costs inevitably flow downstream to concrete and construction material suppliers, exacerbating inflation across multiple inputs for large-scale projects.
The logistics landscape is also evolving due to the change in refinery ownership. Previously focused on domestic supply efficiency, refineries are now optimizing logistics for larger export shipments. This shift raises the risk of domestic shortages during peak construction periods as contractors face tighter delivery schedules and increased working capital demands. The logistics premium embedded in by-product pricing has risen by 10–15%, reflecting higher transport costs and risk premiums imposed by traders.
Investments will be necessary for refineries aiming to enhance profitability through improved margins on by-products. Upgrading facilities such as coking units may require capital expenditures ranging from €50 million to €150 million per refinery. Similarly, downstream buyers must invest in alternative fuel sources and storage capabilities—cement plants might need €20–40 million for diversification efforts—to mitigate exposure to volatile spot pricing.
From a macroeconomic perspective, the repricing of refinery by-products will have lasting implications on public finances across South-East Europe. Increased infrastructure costs necessitate higher capital expenditure or reduced project scopes. Over a five-year period, cumulative additional infrastructure expenditures due to these price changes could reach €1–1.5 billion across the region—a structural adjustment rather than a transient shock.
This transition benefits refinery owners and logistics operators who can capitalize on higher margins while commodity traders exploit arbitrage opportunities between domestic and export markets. Conversely, construction firms bound by fixed-price contracts and public authorities with limited budgets face challenges that may hinder project execution.
Looking ahead toward 2030, it is anticipated that refinery by-products will be fully integrated into global commodity markets with prices remaining volatile and closely tied to international benchmarks. Domestic supply stability will increasingly rely on contractual agreements rather than ownership structures. Policymakers must adapt infrastructure planning strategies to account for heightened input costs and volatility—flexible procurement models and improved forecasting will be essential moving forward.
The ongoing transformation within the energy sector underscores the interconnectedness between energy production and broader economic activities. While refinery by-products may not dominate headlines, their pricing dynamics have immediate repercussions on infrastructure projects throughout South-East Europe.
