Hungarian Prime Minister Viktor Orban does not want the proposal for an oil embargo against Russia to be discussed at the European summit, Monday and Tuesday. Orban is still unable to agree to the proposed import ban because he fears “serious supply problems” for Hungary.
The embargo is part of the sixth sanctions package that the European Commission put on the table at the beginning of this month, following the Russian war in Ukraine. Central to this is an embargo on oil and oil products from Russia: the Commission wants no more crude oil to be imported in six months, and imports of refined oil products must also end by the end of the year.
After weeks of negotiations, next week’s European summit seemed likely to provide a breakthrough. Orban himself asked for the dossier to be taken to the highest political level, but now says that “a discussion would be counterproductive in the absence of consensus”. He wrote this in a letter to European Council President Charles Michel. “Our internal divisions would be exposed without a realistic chance of a solution to our problems. That is why I propose not to raise this issue at the next European Council.”
It was the Financial Times that first wrote about the letter on Tuesday. A European source confirms its existence. Charles Michel has not yet responded to Orban’s demarche.
In an effort to win over the Member States that are most dependent on Russian oil, the Commission has already offered Hungary and Slovakia a postponement of the implementation of the embargo until the end of 2024, and the Czech Republic until June of the same year. Financial compensation has also been discussed, but Budapest says it needs at least €770 million to upgrade its oil infrastructure.
The European Commission’s RePowerEU plan also fails to convince Orban. It wants to make Europe independent of the import of Russian fossil fuels faster (by 2027) and wants to set aside 1.5 to 2 billion euros for investments to guarantee the energy supply. That money should go to Member States through the Recovery and Resilience Facility (RRF), but due to rule of law concerns, the Hungarian recovery plan has still not been approved.
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How much do the other 26 (Member States) want to give to Hungary as an investment?
In an interview with the news website Politico, Commission President Ursula von der Leyen says that no agreement on the oil embargo can be expected at the European summit. “I don’t think the European Council is the right place to solve this, because it’s something very technical,” she says. “These are countries without a sea border that need alternative supply routes via pipelines. So you have to talk about investments in pipelines, to boost supplies, about refineries that need updating and about investments and renewable energy.”
However, there is also a political element at play. “How much do the other 26 (Member States) want to give as investment to Hungary?” asks von der Leyen. “But the biggest difficulties are the technical issues that we are discussing now.”
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