[Global Issue+] Hungary Rising as Europe's 'Outlier'... Could It Become an Obstacle to Sanctions Against Russia?

Opposition to Russian Oil Embargo Until the End... 6th Round of Russia Sanctions Blocked
Demands for Long-term Grace Period and Subsidy Payments... Conflict with Western Europe

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Hyunwoo Lee] The European Union (EU) has failed to reach an agreement on the oil embargo against Russia, which was a key element of the 6th round of sanctions on Russia. This is because Hungary, which requires unanimous consent from all member states, steadfastly opposed the measure until the end. Despite the EU's proposal to secure alternative oil supply sources, Hungary is reportedly holding out, demanding a long grace period and massive financial aid, refusing to agree until these demands are met.

According to the New York Times (NYT) on the 14th (local time), Josep Borrell, the EU High Representative for Foreign Affairs and Security Policy, attending the Group of Seven (G7) foreign ministers' meeting the day before, stated, "I am confident that an agreement on the EU's embargo on Russian oil will be reached soon," emphasizing, "Europe must break free from its dependence on Russian oil."

However, the NYT reported that the entire 6th round of EU sanctions on Russia has not been announced because Hungary continues to oppose the embargo decision, which requires unanimous approval from EU member states. The EU proposed, through Croatia, Hungary's neighboring country, to enable alternative oil imports for Hungary, but Hungary is reportedly demanding a grace period and subsidies.

Hungary Demands 1 Trillion Won Support from EU

[Image source=Reuters Yonhap News]

Hungary has imported more than 90% of its oil and natural gas from Russia. Being a landlocked country, it is difficult to build and maintain terminals for importing liquefied natural gas (LNG) from the U.S. or the Middle East, and it has long depended on Russian energy.

The EU has stated that, given Hungary's small economic scale, it would support gas and oil imports from the LNG terminal in neighboring Croatia, but Hungary insists that this proposal is insufficient. According to CNN, Hungary is requesting a minimum five-year grace period for the embargo to prepare for energy alternatives and demands at least 800 million euros (about 1.07 trillion won) in EU support for facility investments to import oil and gas from Croatia.

Hungary's strong opposition has led to increasing calls for subsidies from neighboring countries such as the Czech Republic, Slovakia, and Bulgaria. Concerns are rising that Eastern European countries, suffering severe economic difficulties since COVID-19, are using energy alternatives as a pretext to demand large sums of support from Western Europe, highlighting the chronic East-West conflicts within the EU once again.

Prime Minister Orban Highlights Conflict with EU

[Image source=Reuters Yonhap News]

Some interpret that Hungary's leader, Prime Minister Viktor Orban, is deliberately highlighting conflicts with the EU. After his landslide victory in last month's Hungarian general election, Orban is criticized for politically exploiting the current situation by emphasizing security risks amid the Ukraine crisis and advocating a pragmatic neutral policy between Russia and the EU.

According to the BBC, Orban advocated a pro-Western stance until the early 2000s, but after the 2008 global financial crisis, as economic difficulties deepened across Europe and the EU cut subsidies, tensions between Hungary and the EU intensified, leading him to shift to an anti-Western platform as a major campaign policy. Within the EU, he is increasingly criticized for his notably pro-Russian actions.

As a result, there are concerns that Hungary will continue to obstruct the EU's sanctions on Russia, potentially cementing its position as a maverick in Europe. Since the Ukraine crisis, the geopolitical importance of Hungary and other Eastern European countries has increased, making it difficult for the EU and the North Atlantic Treaty Organization (NATO) to ignore the voices of Eastern European countries. There are also worries that Hungary will make even more unreasonable demands in the future.

This content was produced with the assistance of AI translation services.