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Polish Orlen to sue Russia for halting oil supplies via the Druzhba

After Russia unilaterally halted oil exports to Poland via the Druzhba pipeline last month, one day after Poland became the first country to donate modern tanks to Ukraine, Polish state energy firm Orlen announced on Monday that it will take legal action against Russia.

Orlen’s CEO Daniel Obajtek said that Poland’s leading oil refiner and retailer will now take legal action and demand compensation from Russia over the ongoing halt in crude supplies to its refineries, refusing to state a figure for potential compensation.

Previously in February, Russian state-owned pipeline operator Transneft, which runs the A section of the “Druzhba” connector, explained that Moscow suspended crude supplies after Poland stopped paying for deliveries.

Noting that routing orders with confirmed resource and transit payments were not processed, Transneft’s spokesman Igor Demin added that the company made operational changes to the schedule, excluding supplies for Polish consumers.”

Poland was the biggest importer of Russian oil in the EU in January when it imported around 10% of its oil from Russia. At the time, Orlen explained this with a previously agreed contract that allegedly could not be broken without EU sanctions.

Since Orlen’s contract with Russia’s Rosneft expired in February, Orlen has been getting oil under a deal with Russian oil and natural gas company Tatneft which will be in force until the end of 2024.

However, the Polish firm is willing to suspend this deal if the EU imposes appropriate sanctions, refusing to define the level of penalties Orlen would face for breaking the contract in question.

It is understood, however, that these are very large sums of money.

Although it ended gas and coal import from Russia by the end of 2022, as announced after Russia’s invasion, the Polish government continued to import Russian oil via the Druzhba system – though at a much lower level – since pipeline deliveries were exempted from the EU sanctions package for seaborne oil imports from Russia implemented last December.

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