EU ‘determined’ to influence Hungary over Russian oil sanctions, says senior official

A senior European Commission official said the EU was “very determined” to maintain a united front against Moscow by securing unanimous support for a proposed embargo on Russian oil and winning Hungary over.

Speaking in an interview, Commission Vice President Maros Šivović admitted that the proposed oil embargo was taking the 27 EU member states to “more and more difficult areas”, given the negative economic impact of these measures.

But he added: “We are very determined to work with Hungary and of course with the rest of the EU member states to achieve European unity…we certainly prefer the 27 to move forward together.”

Diplomats on Friday also expressed optimism about Hungarian Prime Minister Viktor Orban’s swing next week as Budapest seeks more investment and time to transition away from Russian crude.

An EU diplomat said any measure less than the full set of sanctions on Russian oil, banks and individuals introduced by the commission last week would be “viewed as a failure”.

After rushing to implement five packages of comprehensive sanctions on Russia in less than two months, the European Union is at a standstill as it seeks Hungary and other landlocked eastern European countries to agree to measures to phase out Russian oil.

The EU sanctions require unanimous support from all member states to enact laws, giving the holdouts significant leverage over the talks. Officials and diplomats warn that back-up options if Hungary continues to withhold its consent remain unattractive.

For example, it is still theoretically possible for 26 member states to agree to bilateral sanctions against Russia under their national regimes, leaving Hungary to go its own way. But this would not only undermine the EU-wide unity so far apparent, but would also be legally troublesome and procedurally complex.

It would also risk distorting the single market, given that Hungary would be free to buy Russian crude at potentially favorable prices while the rest of the EU would have to get oil from elsewhere.

Diplomats said delaying the oil measures in the sixth sanctions package and proceeding with other measures on banks and individuals was also an unattractive alternative. The European Union is keen to stand by its G7 partners, including the United States, which imposed oil sanctions in March.

“I think we will seek unity for as long as possible, both in terms of member states and in terms of the integrity of this package,” said one EU diplomat. “We don’t want someone else to declare victory over the lack of EU unity.”

Budapest is seeking massive investment from the European Union in its refineries and pipelines as a condition of participation, but other countries, including Slovakia and the Czech Republic, have also sought special terms.

“The Slovaks and the Czechs are at least partially hiding behind the Hungarians – the common cause is ensuring the security of supplies,” said one of the senior EU diplomats, adding that they were seeking extended transition periods, more time to build infrastructure and concrete commitments.

However, the diplomat said negotiators were “rather optimistic” about agreeing to the sixth sanctions package – possibly next week.

The measures are due to be discussed at a meeting of foreign ministers on Monday, which is due to be attended by Hungarian Foreign Minister Peter Sigarto. But much depends on the bilateral talks between Commission Chairperson Ursula von der Leyen’s team and Budapest.

A meeting between Von der Leyen and Orbán on Monday failed to draw a compromise, and Szijjártó on Wednesday requested that the oil embargo rule out shipments of Russian oil via pipelines, limiting it to seaborne shipments – a nonstarter for the Commission and other EU capitals.

Budapest argued that the joint declaration by EU leaders at the informal summit in Versailles in March left room for member states to make their own choices about their “energy mix” while phasing out their dependence on Russian oil, gas and coal. EU leaders meet again at the end of May.

“These are the aspects that prime ministers need to discuss among themselves again,” Orban told public radio last week, stressing that Hungary has as much influence as major countries on the issue. “If we want to change the consensus that was built earlier, we can do it by consensus.”

EU officials insisted that Hungary would swing behind these measures if the EU’s fiscal stimulus were right. One said: “Urban is very practical – it’s all about business.”

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