Panev warns debt crisis looms with Lukoil risk

Mr. Panev suggested that the Lukoil refinery would likely maintain uninterrupted operations in the short term due to a received derogation, though he noted the inherent complexity of such a facility. He explained that the appointed special manager, Spetsov, was intended to control financial flows to prevent funds from aiding Russia’s war efforts while ensuring the refinery continues supplying fuel for domestic and regional markets.

Panev indicated that a mixed management team of Russian and Bulgarian specialists would probably remain. He expressed concern that the new legal amendments granting the state power to potentially sell assets could lead to costly international lawsuits and billions in compensation for Lukoil. He viewed Spetsov’s role as potentially revealing internal company transactions and any past tax violations, which might pressure the Russian owners to sell.

Regarding the national budget, Panev criticized it as the only feasible outcome for the current governing coalition but deemed it excessively left-leaning and large. He warned that the substantial deficit, partly financed through state-owned banks, risked a future debt crisis or tax increases, especially with higher military spending anticipated.