Serbia is expected to maintain stable natural gas supplies over the coming years, with no anticipated price increases for households and the potential for lower costs for businesses, according to the Director of Srbijagas, Dušan Bajatović.
He explained that the latest arrangement with Russia ensures price stability, though it is not a completely new contract but rather an extension of the existing agreement. This extension primarily addresses payment mechanisms and the interpretation of European sanctions, while also guaranteeing uninterrupted transit through third countries at least until early 2028.
A central component of Serbia’s gas pricing remains the oil-indexed formula, which helps smooth out market volatility compared to spot pricing. Since this model is based on a nine-month average, sudden spikes in European gas prices do not immediately impact domestic tariffs.
Although gas prices across Europe remain elevated due to tight supply, declining storage levels, and geopolitical tensions, Bajatović noted that Serbia is largely shielded from immediate price shocks. He also indicated that a significant drop in European prices is unlikely in the near term.
At the same time, Serbia continues to pursue supply diversification. Negotiations with Azerbaijan are expected to resume in April, with potential imports of up to 2 million cubic meters per day, although volumes remain limited by production capacity and infrastructure constraints. Alternative routes, including LNG imports via Germany, are technically feasible but currently less cost-effective.
Gas storage plays a crucial role in ensuring security of supply. Serbia currently stores around 120 million cubic meters of gas in Hungary and 478 million cubic meters at the Banatski Dvor storage facility. Expansion work at Banatski Dvor is ongoing and is expected to double daily withdrawal capacity to approximately 12 million cubic meters.
In parallel, Serbia is investing in new pipeline infrastructure, including connections toward North Macedonia, Romania, and both eastern and western parts of the country. These developments are aimed at further strengthening the resilience and flexibility of Serbia’s gas network.
