Hungary is opposing the European Union’s proposal for a gradual ban on Russian oil imports, with Budapest claiming the plan would be equivalent to dropping an A-bomb on the country’s economy. Meanwhile, tensions are on the rise within the bloc as a handful of dissenting member states are holding up action on a new package of sanctions against Russia.
Hungary is refusing to support the European Union’s planned oil embargo against Russia, opening a new front in the country’s standoff with Brussels. The government is calling for an exemption for oil supplied by pipeline. Foreign Minister Péter Szijjártó said on Facebook that the embargo should be limited to oil supplied by ship and needs to exclude the pipeline on which Hungary relies.
Dropping an atomic bomb
Budapest has been against the oil embargo from the start, citing Hungary’s critical reliance on crude oil imported from Russia. Prime Minister Viktor Orbán compared the Union’s plan to dropping an “atomic bomb” on Hungary’s economy.
"Russian or any kind of oil can only come to Hungary by pipeline. One end of the pipeline is in Russia and the other one is in Hungary. … We cannot accept a proposal that ignores this circumstance. This proposal in its current form is akin to an atomic bomb being dropped on the Hungarian economy," the prime minister said in an interview with Kossuth Radio.
He noted that Hungary would need as much as five years to become independent from Russian oil as the country has no access to seaports.
Orbán is not the sole opponent of the plan; Slovakia and the Czech Republic have also emerged as skeptical critics. These countries also argue that the timeline envisioned by the European Commission, namely phasing out all Russian crude imports in the EU in six months and all refined oil products by the end of the year is overly ambitious and leaves no time for preparation.
The three countries would have a very difficult time if they were to renounce Russian crude imports as their economies depend very heavily on it. All three receive the oil through the Druzhba pipeline.
Brussels admitted that the planned embargo threatens to wreak havoc in the economies of the three countries and offered to extend the deadline.
"We need to find a solution that caters to the objectives that we're trying to reach, which is maximizing the impact on the financing of the Kremlin's war machine while minimizing the impact [for the EU]," an EU spokesperson said.
Under the proposal, Hungary and Slovakia would have until the end of 2024 to complete the phase-out. The Czech Republic would receive an extension until June 2024 as the country plans to be connected to the Transalpine Pipeline, which today links Italy, Austria and Germany.
The embargo on Russian oil is part of the EU’s sixth package of sanctions against Russia and is by far the most radical and far-reaching step proposed by the bloc. The EU buys around 3.5 million barrels of crude and refined products on a daily basis from Russia, which last year amounted to more than EUR70 billion.
Tensions on the rise
Despite hitting an empathetic note, Brussels is by all means intent on getting Hungary on board with respect to the embargo. So much so, that it was ready to offer Budapest financial assistance in exchange for the government agreeing to the sanctions. But the proposal to offer Hungary compensation has drawn sharp criticism from other diplomats, leaving the bloc no closer to signing off on the plan.
Talks between European Commission President Ursula von der Leyen and Vikor Orbán earlier this week brought no solution to the stalemate. EU diplomat Josep Borrell said he hoped that the "difficulties will be raised” by next week, before the EU foreign affairs ministers meet.
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