EXPLAINER: Why is Hungary blocking sanctions on Russian oil?

May 10, 2022, 6:01 AM | Updated: May 11, 2022, 3:05 am
FILE - Hungary's Prime Minister Viktor Orban acknowledges cheering supporters during an election ni...

FILE - Hungary's Prime Minister Viktor Orban acknowledges cheering supporters during an election night rally in Budapest, Hungary, on April 3, 2022. The European Union wants to impose a new round of sanctions against Russia over its war in Ukraine, but Hungary has emerged as one of the biggest obstacles to unanimous support needed from the bloc’s 27 member nations. (AP Photo/Petr David Josek, File)

(AP Photo/Petr David Josek, File)

BUDAPEST, Hungary (AP) — As the European Union tries to impose sanctions on Russian oil over the war in Ukraine, Hungary has emerged as one of the biggest obstacles to unanimous support needed from the bloc’s 27 member nations.

The president of the EU’s executive commission, Ursula von der Leyen, last week proposed phasing out imports of Russian crude within six months and refined products by the end of the year to wean Europe off its dependence on Russian fossil fuels and cut off a lucrative source of income that helps fund Russia’s war.

But Hungary’s nationalist government — one of the most friendly to Moscow in the EU — insists it will not support any sanctions that target Russian energy exports. Hungary is heavily reliant on Russian oil and gas and says the EU oil boycott would be an “atomic bomb” for its economy and destroy its “stable energy supply.”

Von der Leyen made a surprise trip to Hungary’s capital on Monday for negotiations with Prime Minister Viktor Orban to try to salvage the proposal, but no agreement has yet been reached.

Here’s what to know about the talks and what comes next:

WHAT IS HUNGARY SAYING?

Hungary’s government has insisted it will block any EU sanctions proposals that include Russian energy, calling it a “red line” that opposes Hungary’s interests. It gets 85% of its natural gas and more than 60% of its oil from Russia.

Orban, widely considered one of Russian President Vladimir Putin’s closest EU allies, has reluctantly supported previous EU sanctions on Moscow, including an embargo on Russian coal. But he has argued that such moves hurt the bloc more than they do Russia.

Since taking power in 2010, Orban has deepened Hungary’s dependency on Russian energy and says its geography and energy infrastructure make a shutdown of Russian oil impossible.

“We said that sanctions on coal would be all right, because they don’t affect Hungary; but now we really have reached a red line, a double line, because the oil and gas embargo would ruin us,” Orban said in a radio interview Friday.

The landlocked country has no seaport to receive global oil shipments and must rely on pipelines. Plus, a flagship government program to reduce utility bills depends on the relatively low cost of Russian fossil fuels and is a major factor underlying Orban’s domestic political support.

Converting Hungary’s oil refineries and pipelines to process oil from non-Russian sources would take five years and require a massive investment, Orban said. That would further drive up high energy prices, leading to shutdowns and unemployment, he said.

IS THERE A CHANCE FOR COMPROMISE?

Besides Hungary, Slovakia and the Czech Republic are asking for years to phase out Russian oil. The European Commission has said it is willing to help countries that are particularly dependent on Russian oil.

“We acknowledge that Hungary and other countries that are landlocked and have significant energy dependency on Russian oil supplies are in a very specific situation which requires that we find specific solutions,” commission spokesman Eric Mamer said Tuesday.

Mamer said Hungary has “legitimate concerns” about oil supplies and that a phaseout of Russian oil could include “differentiated timelines corresponding to the different situations of specific countries.”

“That is definitely one of the variables, because obviously if you are talking about investment in upgrading infrastructure, you need time,” Mamer said.

He did not specify which countries might be offered delayed implementation of an oil embargo or for how long.

In a tweet Monday after her meeting with Orban, von der Leyen said the discussion had been “helpful to clarify issues related to sanctions and energy security” and that progress had been made but “further work is needed.”

French President Emmanuel Macron spoke with Orban on Tuesday about “guarantees” needed for some member states, like Hungary, that “are in a very specific situation with regard to pipeline supplies from Russia,” according to Macron’s office.

WHAT DOES HUNGARY HAVE TO GAIN?

Blocking the sanctions package could be used as leverage in a separate conflict between Budapest and the EU.

The bloc has withheld around $8 billion in pandemic recovery funds from Hungary over what it sees as insufficient anti-corruption measures and has launched a process to withhold further support over breaches of the EU’s rule-of-law principles.

Hungary has been accused of backsliding on democratic values by exerting excessive control over the judiciary, stifling media freedom and denying the rights of LGBT people.

Orban’s government denies the allegations and argues that the EU penalties are politically motivated.

But with Hungary’s economy reeling amid high inflation and a major budget deficit, it will need that EU money for an economic recovery. As EU officials negotiate with Hungary to gain its support for sanctions on Russian energy, the release of withheld funds could serve as a bargaining chip.

___

Petrequin reported from Brussels. AP reporter Sylvie Corbet in Paris contributed.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

Firefighters hose down a burning car after a strike hit a residential area, in Kramatorsk, Donetsk ...
Associated Press

Russia taking ‘operational pause’ in Ukraine, analysts say

Analysts say Russia may be taking an "operational pause" in eastern Ukraine to reassemble forces for a significant offensive.
10 hours ago
FILE - In this Feb. 27, 2008 file photo, euro coins and dollar bills are seen in Frankfurt, central...
Associated Press

With US dollar nearly equal to euro, impact is being felt

WASHINGTON (AP) — The U.S. dollar has been surging so much that it’s nearly equal in value to the euro for the first time in 20 years. That trend, though, threatens to hurt American companies because their goods become more expensive for foreign buyers. If U.S. exports were to weaken as a result, so, too, […]
10 hours ago
Associated Press

Italy seeks to bring home family whose son died in Egypt

ROME (AP) — The Italian Foreign Ministry said Thursday it is working to quickly bring back from Egypt an Italian family whose 6-year-old son died suddenly in the Red Sea resort of Sharm el-Sheikh and the parents ended up hospitalized. Italian news reports said the child was believed to have suffered from a suspected case […]
10 hours ago
This image released but the Washington County, Md.,  Sheriff's Office, shows Joe Louis Esquivel, 23...
Associated Press

West Virginia man indicted for fatal Maryland shootings

SMITHSBURG, Md. (AP) — A grand jury has indicted the West Virginia man accused of shooting and killing three coworkers at a Maryland machine shop and then shooting and wounding a state trooper who was responding to the incident. Joe Louis Esquivel, 23, of Hedgesville, West Virginia, was indicted June 29 in two separate criminal […]
10 hours ago
Associated Press

Turkish health care workers protest mounting violence

ANKARA, Turkey (AP) — Health care professionals took to the streets in several Turkish cities on Thursday to protest mounting violence against them, a day after a cardiologist was killed by the son of a patient. In Istanbul, police used pepper gas to disperse doctors and other health care workers who tried to march to […]
10 hours ago
FILE - A home with a "Sold" sign is shown, Sunday, May 2, 2021, in Surfside, Fla.  Average long-ter...
Associated Press

Average long-term US mortgage rates retreat this week

WASHINGTON (AP) — Average long-term U.S. mortgage rates eased again this week as the Federal Reserve remains likely to raise its benchmark borrowing rate in its ongoing battle to bring down inflation. Mortgage buyer Freddie Mac reported Thursday that the 30-year rate fell to 5.30% from 5.70% last week. One year ago the average 30-year […]
10 hours ago

Sponsored Articles

...
Carla Berg, MHS, Deputy Director, Public Health Services, Arizona Department of Health Services

Update your child’s vaccines before kindergarten

So, your little one starts kindergarten soon. How exciting! You still have a few months before the school year starts, so now’s the time to make sure students-to-be have the vaccines needed to stay safe as they head into a new chapter of life.
...
Day & Night Air

Tips to lower your energy bill in the Arizona heat

Does your summer electric bill make you groan? Are you looking for effective ways to reduce your bill?
...
Arizona Division of Problem Gambling

Arizona Division of Problem Gambling provides exclusion solution for young sports bettors

Sports betting in Arizona opened a new world to young adults, one where putting down money on games was as easy as sending a text message.
EXPLAINER: Why is Hungary blocking sanctions on Russian oil?