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EU’s Russian oil ban hangs by a thread as mood darkens in Brussels

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EU countries are desperately searching for a way to save their plan to ban imports of Russian oil, as hopes of a breakthrough fade ahead of a crucial European leaders’ summit next week.

European Commission President Ursula von der Leyen, who first proposed the sanctions three weeks ago, signalled on Tuesday that there was little chance of an agreement among all 27 EU member countries in time for the leaders’ gathering in Brussels on May 30.

Behind the scenes, diplomats and officials are still working to stop the package of sanctions falling apart completely as they confront the possibility that they may never reach a deal on banning Russian oil. As has been the case for the past month, it’s Hungary’s Viktor Orbán who is refusing to sign up to the deal, citing the severe cost to his economy of ditching Russian fuel.

Failure would be a damaging blow to the bloc’s credibility and a major political and economic boost for Vladimir Putin, who relies on fossil fuel exports to help finance his invasion of Ukraine.

There are still five days left before leaders meet in the Belgian capital for the European Council summit. The high-profile gathering of 27 national leaders gives vital political direction on the most important issues facing the EU.

Brussels-based diplomats and officials had been looking to the summit as the best chance for agreeing on a blueprint that would be acceptable to Hungary and the other 26 EU countries.

According to people familiar with the discussions, radical ideas are now on the table in the search for options to break the deadlock. These include reviving an earlier proposal to put aside the ban on imports of Russian crude and refined fuels for now and go ahead with the rest of the sanctions package. 

Such a step would derail the main point of the EU’s entire sixth round of Russia sanctions. It also would mark an embarrassment for von der Leyen, who has insisted sanctioning Putin’s oil is hard but must be done.

False expectations

On Tuesday, von der Leyen told POLITICO she did not want to raise “false expectations” that a deal would be agreed at the leaders’ summit.

Others are still working on it anyway. The French government, which currently holds the presidency of the Council of the EU, believes a deal could yet be outlined before the European Council begins.

“There is still a possibility in the coming days to unblock the Hungarian veto,” an Elysée official said on Tuesday. The official said that nothing is expected to be agreed in a meeting of EU ambassadors on Wednesday, but pointed out that two further discussions among EU envoys are scheduled for Friday and Sunday. 

Another potential option could involve a more surgical approach to carving out exemptions from the measures for Budapest. This could include the earlier idea of extending the transition period for Hungary and other countries to comply with the Russian oil ban, depending on certain criteria that Hungary would have to agree to.

A last-minute deal would prevent the question of sanctions hijacking the agenda of the European Council. If no deal is struck in the coming days, the divisive issue will be the elephant in the room, regardless of the formal agenda, diplomats said.

“It’s better for everyone if this doesn’t end up at the leaders’ table,” said one EU diplomat. Both Hungary and von der Leyen said they did not regard the summit as the place to hammer out a sanctions deal. In a letter, Orbán said the meeting was the wrong forum for resolving the dispute.

Others disagreed, arguing that the political direction should be set by leaders if a deal is to be reached. One senior EU diplomat said Orbán’s refusal to talk about sanctions at next week’s summit “kills the possibility” of a quick agreement.

The diplomat was frustrated at Hungary’s growing list of demands for more time and more money to adjust to life without Russian oil. “Hungary doesn’t seem interested in a fast conclusion. If they wanted a deal, it would have happened by now,” the diplomat said.

Some diplomats are skeptical a deal can be reached in the few days left before the summit because the issues with Hungary are too complicated to be resolved in such a short time. 

Another diplomat said failure to get a breakthrough by the time the summit concludes would be disastrous. The diplomat added: “It’s a deal now, or no deal.” 

Suzanne Lynch, Giorgio Leali and David M. Herszenhorn contributed reporting.

This article is part of POLITICO Pro

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