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EU Grants Hungary Exemption from Oil Embargo

The bloc intends to cut off 90% of Russia fuel imports by the end of the year

Prime Minister Viktor Orbán secured Hungary an exemption from a looming ban on Russian oil.

The European Union has been contemplating the latest sanction for the last four weeks but has faced some resistance from Central European countries that are dependent on Russian fuel sources.

Among those nations is Hungary, where 65% of oil and 85% of gas come from Russia.

“Families can sleep well tonight as the most outrageous idea has been averted,” Orbán said in a video on Facebook on May 31.

The E.U.’s latest sanction package is the sixth enacted by the bloc since Russia’s Feb. 24  invasion of Ukraine. Negotiations concluded on May 31 and the package was approved.

By the end of 2022, the E.U. intends to have cut off 90% of oil imports from Russia.

While the agreement bans all Russian oil from being brought into the EU by sea, it allowed a temporary exemption for imports delivered by the Russian Druzhba pipeline to certain landlocked countries in Central Europe — something Orban touted as a victory for Hungarian interests over what he portrayed as potentially disastrous recommendations by the EU,” reports AP News.

In addition to Hungary, Slovakia and the Czech Republic were given exemptions to allow them to transition to new oil and gas suppliers. Bulgaria has until 2024 to stop using Russian fuel.

“For us, this is an opportunity to modernize the refinery, and not raise the price due to changes in the mix,” Bulgarian Prime Minister Kiril Petkov said, per The New Voice of Ukraine.

The bloc also recently agreed to supply Ukraine’s military with the new exceptional macro-financial assistance worth up to 9 billion euro ($9.65 billion) by this year to help the Ukraine fight the invading forces to maintain its territorial sovereignty and integrity,” per Republic World.

Oil prices have surged by 8.1% amid the ongoing Russia-Ukraine conflict.

The E.U. has already taken punitive financial action against Russian coal imports and Sberbank, Russia’s largest bank. The international community has also cut Russia off from the SWIFT international banking system.

Although he commended the bloc for passing the latest round of sanctions, Ukrainian President Volodymyr Zelenskyy objected to the 50-day period that has passed since the sanction package, reports the International Business Times.

The delay has largely been attributed to Orbán, who said the economic consequence of the embargo could be devastating to his people.

“We said that sanctions on coal would be all right, because they don’t affect Hungary; but now we really have reached a red line, a double line, because the oil and gas embargo would ruin us,” Orbán said in a radio interview in early May.

With oil transported through the Southern Druzhba pipeline exempt from the E.U. embargo, the prime minister said fuel prices in Hungary will not skyrocket amid global economic uncertainty.

While the sixth sanction package has been accepted by the bloc’s members, the technical details still need to be finalized later this week.

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