S. sanctions are hurting its business and threatening fuel supply for the country's capital, Berlin, and the region. The PCK Schwedt refinery, controlled by Rosneft, fuels nine out of ten cars in Berlin, supplies petrol across the state of Brandenburg, and is a key ingredient to the chemicals industry.
In a January letter, management made an urgent appeal to economy and energy minister Katherina Reiche to resolve the standoff with the United States over the refinery's future. The business depends on long-term supply contracts, banks for payments, and insurers to cover oil cargoes, all of which is being hit by fear about being swept up by sanctions. This pressure could accelerate the refinery's sale, as one oil group and a large energy investor had explored buying the business.
S. licence and is committed to supporting the refinery. However, the future of the refinery remains uncertain due to ongoing sanctions on Rosneft and Lukoil, Russia's two largest oil firms.
The pressure from Washington has shaken confidence in Rosneft's German arm among banks, insurers, and its main supplier, Kazakhstan. Unimot, a Polish fuel importer, underscored looming risk, stating that there is no way to replace the refining and logistical capacity supplied by the refinery. A task force of officials will meet in the coming days to discuss possible solutions.
At stake is a critical pillar of energy supply as Germany grapples with its biggest postwar slowdown. The German government has significant say in Rosneft's German operations, but not ownership. Rosneft has been looking for a buyer for its German business but to no avail.
S. investor or takeover by the German state are possible options. However, officials in Washington have expressed no particular interest in investing in Europe in recent months.
The Trump administration is committed to ensuring Russia does not profit from exporting energy until it stops the senseless killing. A sale of Rosneft's German business was discussed when President Trump met Russian President Vladimir Putin at a summit last August in Alaska. Rosneft's wider German businesses account for one third of oil refined in Germany.
The uncertainty surrounding the future of the PCK Schwedt refinery highlights the complexities of navigating U.S. sanctions on a global energy market. The pressure from Washington is having a significant impact on Rosneft's German arm, making it challenging for the business to secure long-term supply contracts and payments.
