Topline
The European Union’s ban on Russian oil is in jeopardy Friday after Hungary’s Prime Minister Viktor Orban rejected proposals as too costly and too swift for the country to implement, marking a potentially lethal blow to the bloc’s plans to wean itself off Russian energy as diplomatic wrangling drags on over its toughest sanctions against Moscow yet.
Key Facts
Orban, an ally to Putin who was reelected for a fourth term as prime minister in April, told Hungarian state radio on Friday that Hungary could not support proposed EU sanctions against Russia in their current form, according to multiple news reports.
Plans to ban Russian oil are far too costly and would amount to an “atomic bomb” being dropped on the Hungarian economy, he said.
Hungary would need at least five years and massive investment on infrastructure in order to manage without Russian oil, Orban said.
He said he is willing to negotiate a sanctions proposal that meets Hungary’s interests and is waiting on a new proposal from the European Commission.
While Orban’s objections are not surprising—Hungary is heavily dependent on Russian oil and has consistently shot down proposed energy sanctions against Moscow since it invaded Ukraine in February—they are a major obstacle for finalizing the bloc’s latest round of sanctions, which require unanimity from all 27 member states.
Key Background
Current plans would see most of the EU phase out Russian oil imports within six months, alongside disconnecting some of Russia’s largest banks from the SWIFT international finance system and banning Russian broadcasters from the region. When outlining the sanctions package on Wednesday, European Commission President Ursula Von der Leyen said ending the bloc’s “dependency on Russian oil… will not be easy” but must be done to hold Putin accountable for invading Ukraine. The latest round of sanctions would mark one of the bloc’s most severe moves against Moscow. Sanctions on energy have been divisive, however, due to the bloc’s heavy reliance on Russia for energy. The need for unanimity in decision making means this has hindered the bloc’s ability to meaningfully target one of Putin’s major income streams and, until recently, Germany has been the most significant barrier. The latest proposals are only possible after Germany softened its stance. Other countries, including Hungary, Slovakia, Bulgaria and the Czech Republic, are all among the most reliant on Russian energy imports and are reportedly skeptical of plans. While Hungary has not opposed EU sanctions to date, Orban is a longtime ally of Putin’s regime and an outlier among European leaders for not condemning Russia’s actions in Ukraine.
What To Watch For
Negotiations and concessions. Slovakia and Hungary—two of the countries considered most likely to reject proposals—have both been granted an extra year to wean themselves off Russian oil under the proposals. Like Hungary, the Slovakian government is apparently calling on the EU to give it more time to adapt, according to Politico, citing the country’s deputy energy minister. Slovakia will need “at least three years,” he said.
Tangent
Orban also said Hungary would not support proposed sanctions against Patriarch Kirill, the head of the Russian Orthodox Church, describing it as a matter of “religious freedom.” Kirill, an ally of Russian President Vladimir Putin who has justified Russia’s military operations abroad, is one of nearly 60 people facing travel bans and asset freezes under the EU plans.
Further Reading
Von der Leyen’s team scrambles to find Russia oil ban compromise (Politico)
EU Unveils Plans For Russian Oil Embargo In Latest Wave Of Sanctions For Invading Ukraine (Forbes)
Orbán says EU unity undermined by Russia oil embargo plan (FT)
