Hungary Abandons EU On Proposal To Ban Russian Oil

Richard Ginika Izuora

The European Commission president has faced immediate resistance from Hungary after proposing a ban on Russian oil imports to the EU, aimed at ensuring Vladimir Putin paid “a high price for his brutal aggression” in Ukraine.

Ursula von der Leyen said Russian crude oil should be prohibited within six months and refined products by the end of the year to help cripple Putin’s war efforts.

Member states in Brussels are scrutinising a proposed sixth package of sanctions but in a speech on Wednesday Von Der Leyen said Russian oil flows had to stop, despite the misgivings in some capitals, reports Guardian International.

“Let us be clear: it will not be easy,” Von der Leyen told the European parliament. “Some member states are strongly dependent on Russian oil. But we simply have to work on it. We now propose a ban on Russian oil. This will be a complete import ban on all Russian oil, seaborne and pipeline, crude and refined.

“We will make sure that we phase out Russian oil in an orderly fashion, in a way that allows us and our partners to secure alternative supply routes and minimises the impact on global markets.”

Since the start of the war in Ukraine on 24 February, the NGO Europe Beyond Coal calculates that the EU has sent about €21bn (£18bn) to Russia in payment for oil.

Russian imports account for 25% of oil imports to the EU and are a leading source of revenue for the Kremlin, but the level of dependency varies and Slovakian and Hungarian ministers have already said they will seek exemptions from the proposals.

A spokesperson for Hungary’s prime minister, Viktor Orbán, said there appeared to be “no plan nor guarantees” on smoothly switching from Russian oil in the proposal.

The foreign minister, Péter Szijjártó, wrote on Facebook: “In its current form the Brussels sanctions package cannot be supported, we cannot responsibly vote for it. Hungary could only agree with these sanctions if pipeline imports of crude oil would be exempt from the restrictions. Then Hungary’s energy security could be maintained. Now it cannot.”

Slovakia has been seeking a longer transition period for its switch from Russian oil, but has been offered only an extra year to work with so far, which the government in Bratislava says is insufficient.

The sanctions package will require unanimous support from the EU member states, whose representatives in Brussels are poring over the details with the hope of coming to an agreement by the end of the week.

According to the draft text, the EU would not only prohibit imports but ban any of its citizens and companies from involvement in transporting Russian oil, insuring its transfer or maintaining equipment involved in the movement of the fossil fuel.

The move to prohibit insuring against oil spills and other unforeseen incidents is significant as much of the world’s tanker liability cover goes through companies that are under the jurisdiction of EU law.

Sources said a first meeting of EU ambassadors on the subject of the sixth package had been “tense and difficult”.

As Von der Leyen sought to rally the EU to take the next step, she littered her speech with the names of Ukrainian cities and towns that had been subject to brutal Russian bombardments or where evidence of war crimes had been uncovered.

She told MEPs the EU should additionally target military figures involved in the massacre of civilians in the town of Bucha, north of Kyiv, and in the siege of the port city of Mariupol with restrictive measures, and block Russian state television from being broadcast in the 27 member states.

“This sends another important signal to all perpetrators of the Kremlin’s war: we know who you are, and you will be held accountable,” she said. “With all these steps, we are depriving the Russian economy of its ability to diversify and modernise.”

The EU would also remove Sberbank – Russia’s largest bank – along with Credit Bank of Moscow and Russian Agricultural Bank from the Swift payment system, under the draft sanctions package.

“Putin wanted to wipe Ukraine from the map. He will clearly not succeed,” Von der Leyen said. “On the contrary, Ukraine has risen up in unity. And it is his own country, Russia, he is sinking.”

The EU is preparing to be the main funder of Ukraine’s economic recovery from the war, with billions already committed, but Von der Leyen called on the US and others to match those funds.

Ukraine’s GDP was expected to fall by 30% to 50% this year alone, she said, with the IMF estimating that Ukraine would require €5bn a month “to keep the country running, paying pensions, salaries and basic services”.

“We have to support them, but we cannot do it alone,” Von der Leyen said. “I welcome that the United States announced massive budgetary support. And we, as Team Europe, will also do our share.”

She went on: “Europe has a very special responsibility towards Ukraine. With our support, Ukrainians can rebuild their country for the next generation.

“That is why today I am proposing to you that we start working on an ambitious recovery package for our Ukrainian friends. This package should bring massive investment to meet the needs and the necessary reforms. It should address the existing weaknesses of the Ukrainian economy and lay the foundations for sustainable long-term growth.”

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