The European Union (EU) is eyeing to ban all imports from Russia, the world's second largest crude exporter, to help cripple the country's war efforts on Ukraine.
Imposing the new sanctions against Russia over the Ukraine war would require the unanimous support of all 27 bloc member states. Hungary, which is heavily reliant on Russian oil imports, so far has blocked that bid. The landlocked country is pressing for about 750 million euros ($800 million) to upgrade its refineries and expand a pipeline from Croatia to enable it to switch away from Russian oil.
Hungarian Prime Minister Viktor Orban has argued that an EU oil boycott would be an "atomic bomb" for Hungary's economy and destroy its "stable energy supply."
During a news conference in Budapest on Wednesday, May 25, Foreign Minister Peter Szijjarto said that Hungary would not vote in favor of the oil embargo proposal "as long as it makes Hungary's energy supply impossible."
He blamed EU's executive branch for pushing the plan without ensuring the energy security of Hungary, which gets 85 percent of its natural gas and more than 60 percent of its oil from Russia.
European Council President Charles Michel said he is confident that an agreement can be reached before the council's next meeting on May 30. But in the letter to Michel, Orban said Hungary was "not in a position to agree to the sixth sanctions package until the negotiations succeed in resolving all outstanding issues," and that a solution was "very unlikely" to be reached before next week's summit.
Germany's Federal Minister for Economic Affairs Robert Habeck said the EU can still close a deal on an oil ban in the coming days or look to "other instruments" if no agreement is reached.
Berlin had initially opposed an oil embargo citing its heavy reliance on Russian energy, but recently shifted its stance. (Related: Gas storage in Germany hits record lows as Russia halts fertilizer shipments and European continent reels from high heating costs.)
Other EU member states voiced impatience with the delay. "We need to get on and do this," said Ireland's Foreign Minister Simon Coveney. "This is about a deterrent to the continuation of war. The sooner the EU can finalize that sixth sanctions package the better."
Johanna Sumuvuori, Finland's junior foreign minister said: "It is very important to do our utmost, so that we can make a strong statement as an EU."
The sixth package of sanctions against Russia includes asset freezes and travel bans on prominent Putin supporters. The outlined plans for a Russian oil embargo is expected to come into force at the end of 2022.
Meanwhile, landlocked countries that are heavily dependent on Russian oil were offered a delay in joining the EU embargo. Slovakia were given until the end of 2024, while the Czech Republic has been offered a June 2024 deadline.
Putin: Europe committing economic suicide
Russia is firm that the EU is just putting itself in a risky position by imposing further sanctions on the country amid the conflict with Ukraine.
In an energy meeting last week, Russian President Vladimir Putin warned that Europe would be committing "economic suicide" by seeking to phase out Russian energy supplies.
"Europe will only hurt itself," Putin said, urging state officials to use "ill-thought-out" moves by the West to the country's advantage. He added that EU's "chaotic actions" are not only damaging its own economy, but also leading to an increase in revenues from oil and gas for Russia.
"Of course, such an economic suicide is a domestic affair of the European countries," Putin said.
The U.S. and the U.K. have already imposed an oil embargo, although given that both countries are net oil exporters, this step is rather simpler to take.
Putin admitted that the Russian oil market had been hit by "tectonic changes" amid sanctions, adding that Moscow would help domestic oil producers, including facilitating access to loans and insurance.
The president is seeking to redirect supplies to "friendly" countries as the European nations are looking for ways to wean themselves off Russian energy.
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