Putin’s allies: Why Hungary is demanding a staggering €18bn to cut ties with Russian oil

Russian oil ban not enough to stop them funding war says expert

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Diplomats in Brussels have spent the past two weeks trying to get support from all members of the European Union (EU) to cease Russian oil imports by the end of 2022. The measure is part of a sixth raft of sanctions the bloc wishes to get signed off against Moscow. Doing so would help to cut funding for Russian President Vladimir Putin’s invasion of Ukraine. But the proposals have yet to win over Hungary and its Prime Minister Viktor Orban.

European Commission President Ursula von der Leyen has said a complete ban on imports of Russian crude and refined fuels “will not be easy”, but she added “we simply have to do it”.

On Monday, Hungary’s Government told EU officials that it would need a payment of €15 billion to €18 billion (£15 billion) for it to agree with the ban on Russian oil.

The sum is a significant increase on the €750 million (£634 million) quoted by Budapest’s Foreign Minister Péter Szijjártó last week.

EU diplomats have been shocked by the development, with one telling Politico that the figures being sought by Hungary are “out of the question”.

Why is Hungary demanding a fee?

Mr Orban has said that “in the interests of European unity”, Hungary will not block the sanctions against Russia, although he does not agree with them.

But, he caveated the measures must “not endanger Hungary’s energy security”.

According to Mr Szijjártó, Hungary requires a €15bn to €18bn payment so that it can fund “a total modernisation of Hungary’s energy structure” and combat growing oil prices.

As Hungary is landlocked, it leans heavily on oil imports provided via pipelines and is particularly reliant on those owned by Russian entities.

Officials in the country have stated their opposition to a complete ban on Russian oil imports, and have said the measure should only extend to oil which is supplied by ship.

But the EU is pushing for a full ban to cut finances which are helping to support the Kremlin’s invasion of Ukraine.

Ms Von der Leyen made a dash to Budapest for face-to-face talks earlier this month to talk through Mr Orban’s concerns.

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But it appears the trip was in vain, and a planned video conference with regional leaders to discuss how to help Hungary adapt never materialised.

Initially, the bloc had hoped to overcome Hungary’s reluctance by offering some form of financial compensation via Wednesday’s REPowerEU strategy.

The document set out how the EU should end its dependence on all Russian energy imports by the end of the decade.

However, it now seems that Hungary will require greater persuasion before a unanimous agreement can be reached.

Hungary – a member of both the EU and the North Atlantic Treaty Organisation (NATO) – has condemned Russia’s invasion, but it’s not offered its backing to every sanction tabled by the West.

During his time in office, Mr Orban has nurtured a close relationship with President Putin, which has made him an outlier in Europe.

Alongside opposing a ban on Russian energy imports Hungary has refused to bilaterally provide Ukraine with weapons.

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