Russia's biggest oil producer, Rosneft, began supplying oil to Hungary and Slovakia with Glencore, expanding into new markets after recent acquisitions, three industry sources told Reuters on Jan. 20. The company is supplying Urals crude oil via the Druzhba Pipeline, the sources said.

Rosneft declined immediate comment.

Glencore recently became a Rosneft shareholder after it acquired, together with a Qatari fund, 19.5% in the Kremlin-controlled producer.

Trading sources told Reuters that Rosneft will supply 80,000 tonnes of oil via the route to each of the countries in January, while supplies will total 500,000 tonnes in January to March.

Urals is being supplied to Hungary's Mol Danube refinery and the Bratislava refinery in Slovakia.

Rosneft has ventured into new markets after acquiring Russian mid-sized oil producer Bashneft, whose assets are predominately located in the mountains of the Urals, in 2016.

Bashneft previously supplied about 600,000 tonnes of oil per quarter to Hungary and Slovakia via Normeston trading company.

Rosneft has been supplying oil via the Druzhba Pipeline to Poland, Germany and the Czech Republic. It has gradually ditched intermediaries, such as Souz Petroleum, Mercuria Energy and Sunimex, from the chain of supplies.

Many market observers said Rosneft's deliveries to Hungary and Slovakia via Glencore may be due to obligations it has taken on as part of the deal for Glencore to become a Rosneft shareholder.