EU country pressures Ukraine regarding Russian oil - Politico
Budapest is urging Kiev to support a proposal involving the trade of products from Lukoil, which is currently under sanctions. The plan suggests that these products would be sold to another company before entering Hungary. Read Full Article at RT.com
According to Politico, Hungary has requested that Ukraine endorse a proposed solution to reinstate the Russian oil transit that was halted. This stoppage occurred in June when Kyiv suspended the transportation of crude supplied by Russian energy giant Lukoil through the Druzhba pipeline, citing sanctions against the company. This decision has adversely affected landlocked Hungary and Slovakia, which have lost oil previously exported by Lukoil.
The report states that Budapest is suggesting a simple rebranding of Lukoil’s products, which would facilitate the official sale of crude to Hungarian energy giant MOL before crossing the border. This plan was reportedly introduced by Gergely Gulyas, head of Prime Minister Viktor Orban's office, who asserted that the arrangement could help the oil avoid new sanctions from Kyiv.
Gulyas was quoted as saying, “As soon as we can sign the contracts with the Ukrainian side, they will enter into force.” He mentioned that this plan would likely require an additional payment of $1.50 per barrel for transit outside previous agreements.
In June, Ukraine had blocked the transportation of Russian crude oil sold by Lukoil to Central Europe. Kyiv had previously imposed sanctions on Lukoil in 2018, restricting the company from divesting its business within the country and prohibiting trade operations and involvement in the privatization or leasing of state property. Despite these sanctions, Lukoil continued to send crude via the southern branch of the Druzhba pipeline since EU sanctions did not target such flows.
The European Union had prohibited the maritime transport of Russian crude oil in December 2022 as part of extensive sanctions against Moscow. However, Hungary, Slovakia, and the Czech Republic received exemptions from Brussels, allowing them to obtain alternative supplies.
Hungarian Foreign Minister Peter Szijjarto had previously suggested that the European Commission might be responsible for the suspension of Russian oil supplies through Ukraine, indicating that it could be a move directly aimed at Budapest and Bratislava.
Additionally, Slovakia and Hungary are the only EU members that have opted against supporting the bloc’s policy of providing military aid to Ukraine amid the ongoing conflict with Russia. Both nations have consistently advocated for a diplomatic resolution to the crisis.
Gulyas claimed last month that by blocking oil deliveries, Kyiv appears to be "blackmailing" Budapest and Bratislava due to their consistent calls for a ceasefire and peace.
When approached by Politico for a response, Ukrainian Energy Minister German Galushchenko did not commit to endorsing Budapest’s plan, but noted that Kyiv would “see whether we would get some requests for negotiation from the Hungarians.”
Rohan Mehta contributed to this report for TROIB News