The European Bank has agreed to process payment for the transit of Russian oil through Ukraine, Slovak oil refiner Slovnaft and another source familiar with the situation said, removing the reason for the halt in oil supplies to central Europe last week.

Russian oil supplied by the Druzhba oil pipeline provides 65% of Hungary’s oil needsPhoto: ATTILA KISBENEDEK / AFP / Profimedia

The payment, if confirmed by all parties, will restore oil flows to the Czech Republic after a week-long hiatus and set the stage for future transit payments to the region.

Russian monopoly Transneft said on Tuesday that supplies through the Druzhba pipeline to the Czech Republic, Hungary and Slovakia had been suspended since August 4, as Western sanctions prevented it from paying transit fees to Ukrainian transit company Ukrtransnafta.

Flows to Hungary and Slovakia resumed on Wednesday after Hungarian refiner MOL and its Slovak unit Slovnaft found a solution by paying a commission to Ukrainian transit company Ukrtransnafta, but supplies to the Czech Republic did not resume.

“According to our information, the bank reviewed the initially blocked payment between the transit companies for the transit fee and finally accepted it,” Slovnaft spokesman Anton Molnar said.

“This confirms that the structure created in this way is functional and can be a long-term solution,” he said.

Another source familiar with the matter said the payment had been unblocked by Dutch bank ING and that flows to the Czech Republic should resume by Saturday. ING declined to comment.

Russia’s Transneft said on Friday that the payment for the transit of oil to the Czech Republic has been received by the bank and is awaiting confirmation from Ukraine, reports the Russian state news agency RIA.

“We are waiting for confirmation from Ukrtransnafta regarding the transfer of funds to start pumping (oil) to the Czech Republic,” Ihor Dyomin, adviser to the president of Transnefta, told RIA.

Central European countries depend partly on Russian oil and largely on Russian gas, and have been exempted from a future European Union ban on Russian oil imports until they fix their transport routes and refineries for other types of oil.