The International Institute for Middle East and Balkan Studies (IFIMES), based in Ljubljana, Slovenia, regularly monitors and analyses key developments in the Middle East, the Balkans and the wider international context. Its latest study, Serbia 2025: Geopolitical resilience, energy security and sanction management, places particular focus on the current situation in the Republic of Serbia, notably in relation to the introduction of additional restrictive measures targeting the Oil Industry of Serbia (NIS).
The IFIMES research highlights the principal factors shaping Serbia’s political, economic and geopolitical environment – ranging from the direct impact of the sanctions and broader regional and global dynamics to the country’s internal institutional and political challenges. The analysis offers a clear insight into how Serbia is responding to changing international circumstances, redefining its energy strategy and strengthening institutional resilience to preserve stability and security amid an increasingly turbulent global environment.
Sanctions against NIS and redefining Serbia’s energy strategy
The decision by the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) to introduce additional restrictive measures against the Oil Industry of Serbia (NIS), a company with majority Russian ownership, represents one of the most sensitive challenges for Serbia’s energy, economic and foreign policy position in 2025. These sanctions cannot be viewed as a mere technical matter confined to the energy sector; they constitute a profoundly geopolitical instrument that directly affects Serbia’s relations with the European Union, Russia, regional energy markets, as well as the dynamics of its future transition towards green energy sources.
Although the negative economic effects of the sanctions could be significant – particularly in the areas of refinery operations, supply stability and the investment cycle – previous experience indicates that Serbia has been able to successfully absorb such pressures by diversifying supply routes, securing stable gas and oil contracts and increasing the share of renewable energy sources within its energy mix.
During 2024–2025, the Government of the Republic of Serbia introduced a set of mechanisms designed to maintain supply continuity and safeguard the domestic energy market. The key measures include: expanding the capacity of energy interconnections with Bulgaria and North Macedonia, increasing investment in storage capacity, intensifying cooperation with Hungary, Azerbaijan and the United Arab Emirates, as well as strengthening national capacities through the development of new renewable energy projects.
The estimates of the economic effects of the sanctions suggest a potential decline in NIS revenues and the resulting pressure on the budget, mild fluctuations in the oil and petroleum products market, a slowdown in the investment cycle and infrastructure development, yet a relatively limited impact on the country’s overall GDP and fiscal stability.
The IFIMES assesses that the sanctions imposed on NIS have not led to any destabilisation of Serbia’s energy system. On the contrary – and paradoxically – these measures have acted as a catalyst for accelerated diversification and the strengthening of energy autonomy. This demonstrated ability to adapt underscores the high degree of institutional resilience and the long-term strategic stability of the Republic of Serbia.
Energy security: between sanctions and new opportunities
The International Institute IFIMES assesses that the sanctions imposed on the Oil Industry of Serbia (NIS) should not be viewed solely as a threat, but primarily as a powerful catalyst for a profound strategic transformation. Serbia is entering one of the most significant phases of its energy history: by 2030 it must simultaneously reduce its dependence on Russian energy sources, safeguard price stability and maintain geopolitical balance in the region.
The new strategic energy framework encompasses several key directions of action:
- Strengthening the economic model of NIS by increasing the participation of the Serbian state and involving new domestic, regional and European partners;
- Modernising the Pančevo oil refinery to increase competitiveness, technological sophistication and productivity;
- Deeper integration into regional energy markets to ensure greater flexibility and reliability of supply;
- Accelerated development of gas interconnections and diversification of gas sources, a vital component of energy security;
- Investments in energy efficiency, renewable energy sources and advanced energy-storage technologies, thereby laying the groundwork for a sustainable long-term transition.
In this way, the energy transformation becomes not only an economic and developmental priority but also a central pillar of national security. Through this process, Serbia reinforces its strategic position and resilience in an increasingly complex regional and international landscape.
The restrictive measures imposed on NIS have not diminished Serbia’s ability to retain its leading role in energy and transport connectivity projects, reaffirming its strategic and constructive position in the region.
Serbia in 2026: between stabilisation and strategic consolidation
The beginning of 2026 marks a new phase of political consolidation. The announced early elections will serve as a pivotal moment for institutionalising political stability and laying the foundations for long-term development grounded in the principles of democracy, predictability and accountability. For the institutions, this will be a test of professionalism and independence, while political actors face the challenge of demonstrating maturity and readiness for constructive dialogue.
At the same time, 2026 brings a new geopolitical dynamic: the continued redefinition of the EU’s enlargement policy, the intensification of regional connectivity through strategic initiatives, and the final preparations for EXPO — a project of central importance for Serbia’s international visibility and image. The year ahead also confronts the EU with a fundamental question: does it intend to integrate the Western Balkans or leave the region in a geopolitical “grey zone”?
Serbia enters 2026 with clear messages: political stability is within reach, its economic and energy resilience is unequivocal, its regional position has been consolidated, and the European path remains a strategic choice — pursued with a firm insistence on equality, partnership and objectivity.
If, over the course of the year, institutions are further strengthened, the policy of accountability is sustained, dialogue mechanisms are developed and relations with international partners are approached more rationally, Serbia has the potential to make 2026 a true turning point — affirming itself as a stable, resilient, predictable and reliable state, firmly anchored in the European perspective while preserving its strategic autonomy and strong international integrity.
The article was originally published on IFIMES’s website and has been republished and edited with permission.