EU tensions grow over Russian oil ban as Hungary demands exemption

The European Commission is facing a backlash against plans to send funding to Hungary as part of an effort to persuade Prime Minister Viktor Orbán to agree to EU sanctions on Russian oil.

At a meeting of senior diplomats in Brussels on Wednesday, several EU countries raised concerns about a plan to offer Hungary compensation — first reported by POLITICO — as part of a forthcoming energy strategy, diplomats said.

The dispute reflects the increasing difficulties confronting officials in Brussels as they seek to ratchet up pressure on Moscow over the war in Ukraine.

Orbán’s government on Wednesday hardened its opposition to the EU’s proposal for a full ban on importing Russian crude and refined fuels, calling for an exemption for oil supplied by pipeline.

Hungarian Foreign Minister Péter Szijjártó said in a Facebook video on Wednesday that the embargo should be limited to oil supplied by ship and needs to exclude the pipeline on which Hungary relies.

One week since European Commission President Ursula von der Leyen announced her blueprint for a sixth package of Russia sanctions, the bloc is no closer to signing off on the plan.

Despite offering more time to Hungary, Slovakia and the Czech Republic to comply with the ban on oil imports, Budapest continues to hold up a deal. Banning oil from Russia would be devastating to Hungary’s economy, Orbán has said. The crisis is also a chance for the recently re-elected Hungarian premier to assert his influence.

Von der Leyen wants to target Vladimir Putin’s oil exports as a means of shutting off a vital source of funding for the Kremlin’s war in Ukraine.

Talks between von der Leyen and Orbán on Monday ended without a deal, and a follow-up videoconference between the Commission and regional players, which was due to discuss cooperation on oil infrastructure, has not been scheduled yet.

The meeting of EU ambassadors on Wednesday resulted in no more clarity on the timing of any agreement, the diplomats said. One reason for the delay is that the sanctions package is set to be linked to the forthcoming REPowerEU strategy for ending the bloc’s reliance on Russian fossil fuels, due to be published on May 18.

Under the energy plan, financing and infrastructure reforms are likely to be considered to help those countries — such as Hungary — which face the greatest difficulties moving away from Russian oil and gas.

Top EU diplomat Josep Borrell on Tuesday said he hoped that the “difficulties will be raised” by next week, before the EU foreign affairs ministers meet on Monday. If not, Borrell said it’s up to foreign affairs ministers to discuss the package.

Jacopo Barigazzi contributed reporting.

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