The EU, when announcing the embargo on Russian oil imports--to come into force at the end of this year--exempted imports of Russia crude and petroleum products via pipeline because several landlocked countries, such as Hungary, the Czech Republic, and Slovakia, are highly dependent on pipeline oil supply from Russia. EU member states dependent on Russian pipeline oil were given a temporary exemption to import Russian crude via pipeline until the EU Council decides otherwise, but were not allowed to resell such crude oil and petroleum products to other Member States or third countries.

International benchmark Brent crude jumped by $2 per barrel to trade near $98 as the news added to concerns about reduced energy supplies.

Transneft said it made payments for August oil transit to Ukraine's pipeline operator Ukrtransnafta on July 22, but the money was sent back on July 28 as the payment did not go through. It said the shipments were halted from Aug. 4. Gazprombank, which handled the payment, said the money was returned because of European Union restrictions, Transneft said in a statement.

The grant funds were provided by the United States and directed to the World Bank's Multi-Donor Trust Fund as part of the Public Expenditures for Administrative Capacity Endurance in Ukraine