European gas prices have risen by almost 30% since April, reaching around €65/MWh, according to Srbijagas general director Dušan Bajatović. Brent crude has moved above $90 a barrel, increasing pressure on energy costs ahead of the winter heating season.
Bajatović said the increase is linked to stronger European and Asian demand, slower replenishment of EU storage facilities, tighter LNG supply and the gradual reduction of Russian gas imports into Europe.
Oil-linked Russian supply for industrial customers
Most Serbian industrial customers are expected to continue receiving gas under Serbia’s long-term arrangement with Russia. The pricing formula is linked to oil rather than directly to European hub prices, which Bajatović said provides some insulation from short-term gas-market volatility.
Bajatović expects the effect to remain manageable while crude oil stays below $100 a barrel. He also indicated that Russian deliveries are expected to remain unaffected before 1 January 2028.
Regulated household tariffs shift risk to Srbijagas
Serbia does not plan to increase regulated household gas prices despite the sharp rise in European wholesale costs. The approach protects consumers but transfers more market risk to Srbijagas and potentially to the state balance sheet.
A sustained rise in oil-indexed contract prices without a corresponding tariff adjustment would compress the company’s margin unless the difference is covered through cross-subsidies, accumulated liquidity or budget support.
Storage levels and reserves support winter readiness
Serbia’s storage position is described as comparatively strong. The Banatski Dvor underground facility is approximately 93% full, holding around 482mn cubic metres.
Additional Serbian reserves in Hungary are being replenished at 1–1.2mn cubic metres a day. This adds to supplies available for the winter period.
Banatski Dvor expansion and alternative supply routes
Expansion of Banatski Dvor is continuing despite delays tied to international sanctions. Six of 12 planned new wells have been drilled, compressor equipment has been procured, and an additional production line is expected to enter construction.
After the upgrade, maximum withdrawal capacity is projected to reach 12mn cubic metres a day. Serbia can also access alternative supply through Azerbaijan, Greece, Turkey and north-western European markets, although these routes are currently more expensive than Russian gas.
Work is progressing on a Romanian interconnector and on a proposed gas-fired power plant near Niš being developed with Azerbaijan. Bajatović expressed confidence that the Russian supply agreement will be extended .
He said maintaining unchanged household prices will become progressively more expensive if oil remains above $90, if European LNG markets tighten further, or if geopolitical restrictions affect existing contractual and payment arrangements .
