In what will most certainly be a move that will only increase tensions between Russia and the West, a Ukrainian court ruled on Nov. 26 that the state can go ahead and confiscate and nationalize 1433 kilometers of Russian pipelines that run through the Eurasian country, potentially leading to a showdown over oil delivery to customers in both Ukraine and Eastern Europe.
The Ukrainian Supreme Court ruled on Wednesday that Russian oil company Transneft had illegally registered their ownership of the pipeline under a false name and subsidiary, and that their claim is now negated, thus allowing the Ukrainian government to seize full and complete control over the Western directed pipeline.
A spokesman for Transneft, Igor Demin, stated that unless an appellate court overturned this decision, the pipeline would subsequently fall into disuse as the Russian oil company would cease shipments through the line, and thus affect oil and diesel deliveries to countries like Hungary.
The Ukrainian Supreme Commercial Court of Appeal has upheld the nationalization of 1,433 kilometers of pipeline through the country which it says was illegally registered in the name of a subsidiary of Russia’s Transneft.
A spokesman for Transneft, Igor Demin, told TASS that the company intends to appeal the decision, and added that it will lead to a decline in the transit of product, and “the pipeline asset will turn into a pile of iron.”
In October, the President of Transneft Nikolay Tokarev said the company wouldn’t pump oil through Ukraine towards Hungary if the government went through with the nationalization of the pipelines. – RT
Much of the ongoing crisis in Ukraine was originally tied to the state’s inability to pay for prior and currenct oil and natural gas shipments they had received from Russian companies. In addition, it was only after Russia offered to lend Ukraine $15 billion to help pay for their budgetary shortfalls that the West intervened and aided in the coup that toppled the democratically elected Kiev government.
Tensions remain high between Russia and the West over Ukraine, with economic sanctions and lower oil prices driving down much of Russia’s economy. And while President Vladimir Putin has been very patient in refraining from any military or aggressive actions against its long time neighbor, the confiscation and nationalization of Russian property could very well spark an escalation to the crisis, and bring a strong response over the loss to a part of Russia’s lifeblood.