Hungary fears Russian oil ban would be 'atomic bomb' for economy

Prime Minister Viktor Orban claims his nation would need five years to phase out imports

Viktor Orban said Hungary opposed an immediate oil ban and sanctions against the head of the Russian Orthodox Church. Reuters

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Hungary’s Prime Minister Viktor Orban said on Friday that banning Russian oil would amount to dropping a nuclear bomb on his country’s economy, as he promised to pursue changes to a sixth package of European sanctions.

Mr Orban said Hungary would need five years to phase out Russian oil rather than the seven months proposed by the European Union or the two or three-year grace period sought by other member states.

Speaking to public radio, Mr Orban – long regarded as the EU’s most Moscow-friendly leader – questioned whether such a five-year overhaul would be worth it when the war in Ukraine might be over by then.

Banning Russian oil any sooner would be “an atomic bomb against the Hungarian economy,” said the recently re-elected Mr Orban, who insisted he was not being deliberately difficult but merely representing his country’s interests.

“We need five years for this whole process to be completed ... one to one-and-a-half years is not enough for anything.”

The proposed oil ban is the centrepiece of the sixth round of sanctions on Russia put forward this week by the European Commission, which would need to be signed off by all 27 member states before taking effect.

Commission President Ursula von der Leyen wants crude oil imports phased out within six months and refined products by the end of the year, in an embargo that would cover both pipelines and tankers.

She said in a speech on Friday that diplomats had to tread a fine line to damage Russia but not Europe, because the EU's economic weight was a powerful lever for supporting Ukraine.

But “we cannot in the long run send large sums to a country that attacks our neighbours with an unjustifiable war,” she said.

Ambassadors to the EU, who typically seek consensus on sanctions before they are formally voted on by the European Council, were meeting in Brussels on Thursday after an initial round of talks was described as inconclusive.

Slovakia says its oil refineries would need a grace period to replace Russian supplies. AFP

Supporters of a ban, such as Poland and Lithuania, say an embargo is necessary to deprive the Kremlin of one of its main sources of income and a geopolitical stranglehold over its neighbours.

But Hungary is not alone in fearing the economic consequences at a time when fuel prices are already soaring. Slovakia and the Czech Republic, landlocked like Hungary, have likewise said they need more time to replace Russian pipelines.

Diplomats have not ruled out offering exemptions to particularly import-reliant countries, with Bulgaria saying that it too would like an opt-out if it is available.

However, Mr Orban suggested he regarded some of this opposition as softer than Hungary’s. “There are countries that sometimes speak, but in the end the Hungarian government is often left alone in the vote,” he said.

Hungary has irritated Ukraine with an equivocal stance on the war and by refusing to send weapons, although it did not stand in the way of five earlier rounds of sanctions including a ban on Russian coal. It is still working with Russia's state-owned Rosatom on upgrading a Hungarian nuclear power plant.

Germany and Austria had initially opposed oil sanctions but softened their stance after making progress on replacing Russian imports at home. France said it was hopeful that sanctions could be agreed on this week.

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Ukraine wants gas banned as well but the commission has not yet proposed this. The EU is especially reliant on Russian gas supplies and exporter Gazprom last week stopped flows to Poland and Bulgaria for refusing to pay in roubles.

The sixth sanctions package also includes proposals to target Russia’s largest bank, ban its state media from all platforms in the EU and penalise more prominent Russian figures including military commanders accused of war crimes.

Hungary again dissented by saying it would oppose any sanctions against the head of the Russian Orthodox Church, Patriarch Kirill. Mr Orban said this was an issue of religious freedom.

The cleric is a longstanding ally of Russian President Vladimir Putin and has made public statements supporting the war in Ukraine.