EU caves to Hungary’s demands to agree to Russia’s oil ban

© Reuters. Hungarian Prime Minister Viktor Orban listens to questions from the media as he arrives at a summit of EU leaders trying to agree on Russia’s oil sanctions on Ukraine in response to Russia, in Brussels, Belgium, May 30, 2022 Invasion of Ukraine

By: John Chalmers and Gabriela Bachinska

BRUSSELS (Reuters) – European Union leaders made concessions to Hungary, agreeing to impose an oil embargo on Russia over Russia’s invasion of Ukraine, reaching a deal early on Tuesday aimed at cutting 90 percent of Russian crude imports into the bloc by the end of the year. That year.

By pledging that the EU’s embargo excludes pipelines that landlocked Hungary depends on Russian oil, the bloc aims to reduce Moscow’s revenue to fund the war it waged in Ukraine three months ago.

“It’s a fair compromise … it’s the best we can get,” Estonian Prime Minister Kaya Karas told reporters a day after arriving at an EU summit where leaders will discuss Ways to mitigate soaring energy prices.

Freshly re-elected Hungarian Prime Minister Viktor Orban, now one of the EU’s longest-serving leaders, reiterated that a total embargo would be an “atomic bomb” for the Hungarian economy.

“We couldn’t bear to run the Hungarian economy with more expensive (non-Russian) oil … it was the equivalent of an atomic bomb, but we managed to avoid it,” Orban said in a video released Facebook (NASDAQ: ).

Once Poland and Germany stop buying oil by the end of 2022, the embargo, which will be legally enforced in the next few days, will hit seaborne shipments of Russian oil and cover most oil imports from Russia, which diplomats and officials from both countries say is now government policy.

The remaining 10% will be temporarily exempted from the embargo so that Hungary, Slovakia and the Czech Republic can enter from Russia via the Druzhba pipeline.

Latvian Prime Minister Krisjanis Karins said keeping the EU united was the primary goal, despite effectively meeting the demands of Hungary, which rights groups say is increasingly authoritarian and combative towards the bloc.

“The important message is that the EU’s purpose remains united; the purpose is to stop Russia’s war of aggression in Ukraine,” Carlins said.

The next target for Russian gas?

While details still need to be hammered out, the oil embargo follows an earlier ban on Russian coal and allowed the EU to impose a sixth round of sanctions that included removing Russia’s largest bank Sberbank from the SWIFT international system.

Moscow has called its war in Ukraine a “special military operation” to rid Ukraine of dangerous nationalists and to counter EU sanctions by cutting off energy supplies to Bulgaria, Poland, Finland and the Netherlands.

After pushing for an oil embargo, targeting Russian supplies looks set to be the EU’s next diplomatic battleground in the coming weeks.

While several leaders on Tuesday called for the start of a seventh round of sanctions, Austrian Chancellor Karl Nehamer said: “Gas cannot be part of the next round of sanctions.”

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