European leaders plan to pay Hungarian government to back oil sanctions

European Union officials could offer Hungary financial compensation in return for backing the EU’s sixth round of sanctions, named REPowerEU, against Russian oil imports, according to to Politics. The Hungarian government has been unwilling to support reducing its heavy reliance on Russian oil and natural gas, but the European Commission has pledged to strike a deal and ensure that the sanctions come into effect next week.

Politico reported, based on the statement of three EU officials, that the money sent to Hungary would be part of the EU’s new energy strategy of finding alternatives to Russian fuel. The EU openly opposes Russia’s war on Ukraine, as does the Hungarian government, but the bloc has continued to fund Putin for his oil import needs.

The oil sanctions, proposed on May 4, were described by Prime Minister Viktor Orbán as the equivalent of dropping a “nuclear bomb” on the Hungarian economy.

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Replacing Russian oil imports would take years and cost several hundred million forints, while changes to Hungary’s power transmission system would cost trillions of forints, the prime minister said.

Talks between the Commission and Orbán’s administration have so far been fruitless, although plans include an extension for Hungary and Slovakia to end their oil imports from Russia by the end. 2024 (the previous date was 2023), rather than the end of 2022. REPowerEU also aims to phase out dependence on Russian fossil fuels before 2030.

An EU official described time and money as “communicating vessels” and told Politico that “The more we can help Hungary with REPowerEU, the faster they can get away from Russian oil.”

EU leaders determined to reach an agreement

Other EU heads of state are committed to the plan, and French President Emmanuel Macron recently spoke by phone with Orbán in the hope of “finalizing in a spirit of solidarity the guarantees necessary for the conditions of oil supply”, according to a French official. .

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Hungary receives more than half of its crude oil from Russia, so a transition to other sources would not be short of challenges.Continue Reading

Finland is another EU member state whose dependence on Russian energy is similar to that of Hungary, import 80% of its crude oil and about a third of its natural gas come from Russia. The Prime Minister of the northern European country, Sanna Marin, declared at the EU summit in Paris that Finland is cautious about combined efforts on energy sanctions, favoring individual transitions from oil dependence, but acknowledges that change is needed.

It is a very difficult situation that we have these very severe economic sanctions on the one hand, and on the other hand we are financing the Russian war by buying oil, natural gas and other fossil fuels from Russia.

If EU leaders fail to reach a consensus on the sanctions package, it will be up to foreign ministers to discuss it when they meet on Monday, the High Representative for Foreign Affairs and Policy has said. Security, Josep Borrell.

Orbán: EU sanctions would end utility price cuts

Prime Minister Orbán said the EU’s proposed sanctions against Russian oil “are the height of an atomic bomb dropped on the Hungarian economy”. If Hungary accepts the proposal, it would mean an end to the price cuts for public services promised by the government, he said. declared in his last interview on Kossuth Rádió.

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According to calculations by left-leaning economic think tank GKI, continuing to cut utility bills could, on average, cost a Hungarian family 320,000 forints this year.Read More

Botond Feledy, a foreign affairs expert, told Telex that the Hungarian position can be summed up as Orbán’s determination to “get a little more out of the system”.

The government has yet to say where it stands on a 2024 deadline to end its imports of Russian oil, but other member states, such as Bulgaria (which previously relied heavily on Russian oil), have already started requiring also extensions, if offered to other Member States.

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Minister of Foreign Affairs on the talks between the President of the EC, Orbán: the meeting “made it possible to move forward”

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However, Péter Szijjártó added that more talks were needed for Hungary to change its position.Continue Reading

Minister of Foreign Affairs and Trade Péter Szijjártó declared that Hungary can only realistically support the oil embargo if it exempts pipeline transport. An oil embargo, he said, would increase fuel prices by 55-60% and would be noticeable for all other products.

Photo illustrated by Vivien Cher Benko/MTI/Prime Minister’s Press Office

Laura T. Thrasher