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Will the European Union ever get around to ditching its addiction to Russian oil? Not if Viktor Orbán can help it.
Hungary’s newly reelected prime minister has emerged as the single biggest roadblock to ratcheting up sanctions on the hugely profitable energy sector that’s financing Vladimir Putin’s war machine.
Pressure is building across the bloc for a sweeping ban on oil. On Thursday, an overwhelming majority of European lawmakers demanded an “immediate full embargo” on Russian oil, gas and coal. European leaders in Brussels, as well as the governments of France, Italy, Poland and the Baltics are all on board to go further in sanctioning Russian energy.
Germany is reluctant to move too quickly on energy, even seeking to delay the moment a full ban on Russian coal imports comes into force. But even in Berlin, there’s a growing acceptance that paying Putin for oil will have to stop eventually.
When it comes to Hungary, however, the obstacle remains firm.
“Oil is finally looking doable for Germany,” said one EU diplomat. “But now we have a Hungary problem.”
According to Orbán and his team, energy sanctions are so important that they should be discussed by EU heads of state and government rather than their representatives in Brussels. Orbán also reportedly made clear he would block sanctions on oil and gas, warning this would be a “red line” because cutting off Russian energy imports would “kill Hungary.”
In theory, EU sanctions must be unanimous but the problem of smaller countries trying to block an embargo cropped up when Russia invaded Crimea in 2014. At the time, Hungary and Slovakia were the potential obstacles and the other EU countries studied the legal option of bypassing the pro-Russia camp. This Plan B — which was not ultimately used — would have meant that all countries apart from Hungary and Slovakia would have imposed bilateral sanctions on Moscow. While this would have dealt a bad blow to EU unity, diplomats insisted at the time that it would have been a workable way around the impasse.
Shades of red
Another EU diplomat said there was sympathy for Hungary’s concerns, given the country’s dependence on Russian gas. But Russian oil can be more easily replaced by other suppliers. The question for the coming weeks, the diplomat said, will be: “Which shade of red is Orbán’s red line?”
Another key question is how quickly other more skeptical European countries, led by Germany, will be willing to ditch their dependency on Russian oil.
EU diplomats gathered on Thursday to discuss the bloc’s fifth package of sanctions designed to push Russia to end the war in Ukraine.
The EU’s latest sanctions proposal was strengthened after an international outcry over alleged atrocities committed by Putin’s forces in places such as Bucha. For the first time, the package hits Russian energy imports to the EU. But it focuses on cutting out less valuable coal instead of moving against Russian oil, which would deal a bigger blow to Moscow’s war fund.
What’s more, the coal ban is actually a phase-out rather than an immediate, blanket embargo. Germany has been pushing to prolong the three-month grace period to four months, EU diplomats said. This deadline is more in line with Berlin’s plans to reduce its dependence on Russian coal by the fall.
As for banning oil, while the will to act is growing stronger in Berlin and elsewhere, the timeline remains unclear. So far, senior EU figures seem to think it will take “weeks” before the bloc is ready to switch off Russian oil imports.
Weeks, not days
On Thursday, French Economy Minister Bruno Le Maire called for a stop to imports of Russian oil “in a few weeks.” Italian Prime Minister Mario Draghi on Wednesday also pushed for further measures. “Do you prefer peace or the air conditioner on? This is the question we have to ask ourselves.”
Poland and the Baltics worry the ban on coal risks allowing other countries to think they’ve done enough on the energy sector. Behind closed doors, several EU ambassadors this week raised the need for an oil embargo, EU diplomats said.
Until last week, Germany and Austria had firmly opposed targeting oil or gas, with German Chancellor Olaf Scholz warning of recession and mass poverty for Europe if it were to go cold turkey on Russian energy supplies. But officials suggested Berlin is softening its opposition to ending oil imports.
“We will need not only alternative supplies but also energy savings, energy efficiency if we want to manage this independence in a few weeks,” the EU’s economy commissioner, Paolo Gentiloni, said Thursday at the Delphi Economic Forum. “If we have more time, it would be less costly, but we know peace has a cost.”
Michael Kruse, the energy policy spokesperson of the Free Democratic Party (FDP), one of Scholz’s two coalition partners, earlier this week referred to a similar timeframe.
“We need to get out of Russian oil as quickly as possible,” Kruse said. “For that to succeed, new distribution routes to eastern Germany must be established, because Russian oil is consumed primarily there. This can be done within a few weeks.”
The German economy ministry did not immediately respond to a request for comment on whether Kruse’s timeline was correct.
Previously, Germany has said that contract changes will mean it can reduce Russian oil imports from 35 percent to 25 percent of consumption “in the coming weeks and months.”
A paper prepared by the economy ministry for this week’s Bundestag’s economy committee session, obtained by German news site Klimareporter, outlines that “if all Russian supplies were to fail to appear at short notice, the supply of crude oil could be secured theoretically — meaning without regard to transport possibilities and oil quality — with the oil reserve alone for more than 200 days.”
But the paper also warned that an immediate embargo could temporarily cause “market distortions and supply bottlenecks” at least in east and central Germany.
Paola Tamma, Leonie Kijewski and Giorgio Leali contributed reporting.
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