Hi Marc, what will happen if Slovakia and Hungary stand their ground?
‘That is not good for the image of the European Union. The member states jointly dealt with five heavy sanctions packages at breakneck speed. If this sixth sanction package, which is even more severe, does not come, the outside world will say: look, this is the end of the unanimity.
‘In addition, you assure Russian President Vladimir Putin of one of his main sources of income, namely fossil energy. The seventh or eighth sanction package would be about gas. But if the EU cannot arrange a boycott for oil, it will not work at all with gas.
‘In addition, this sixth package includes a number of other sanctions. For example, Russia’s largest bank, Sberbank, would be cut off from the international payment system Swift and new people would be added to the sanctions list, including Patriarch Kirill, Russia’s highest-ranking cleric. If there is no agreement on the package, none of this will happen.’
How would the failure of the oil boycott affect relations between EU countries?
“It would really make Hungary the pariah of the EU. Until now, the countries of the Visegrad group, Hungary, Poland, the Czech Republic and Slovakia, have acted jointly, for example on migration and rule of law issues. But Hungary takes a completely different position on the war in Ukraine. Poland, for example, is one of the strongest supporters of the sixth sanctions package.’
Why are Hungary and Slovakia so vehemently against the oil boycott?
‘Hungary and Slovakia are very dependent on Russian oil. About 60 percent of the oil that Hungary uses comes from Russia. For Slovakia that is even almost 90 percent. Hungary also currently has lucrative gas contracts with Russia. Moreover, the two countries have no ports: they cannot easily arrange another supply route for oil. If Hungary and Slovakia were to stop importing Russian oil by the end of this year, they would have a huge problem.
‘The EU has looked into whether other pipelines could be used to supply oil to Hungary and Slovakia, but the capacity of those pipelines would have to be increased enormously. That costs money and time. In addition, the Hungarian refineries would have to be adapted for oil from other countries. That also costs a lot of money. The accelerated switch from fossil energy to sustainable alternatives? Time and money.’
Can Hungary and Slovakia not be persuaded with a large bag of money?
‘They did ask for that, yes. According to one person concerned, the Hungarian ambassador mentioned an amount of between 15 and 18 billion euros during a meeting with his colleagues. That’s way too much. The EU has said that it is willing to help pay for, for example, the refurbishment of the refineries. But she doesn’t want to pay because Hungary will soon have to buy more expensive oil because its lucrative contract with Gazprom has expired.’
Are the other EU countries unanimously positive about the abandonment of Russian oil?
‘No, the Czech Republic and Slovenia don’t like it either, but those countries are hiding behind Hungary and Slovakia too. Other countries will be that whole boycott a sausage. Ireland, for example, is not affected at all. The Netherlands a little, but also much less than Hungary. The fact that Russia has cut off Finland from gas was not a problem either: that country got about 5 percent of its gas from Russia.
But the further the sanctions go, the more it hurts the EU. The amount of trade affected by the previous package, which included a coal boycott, is greater than all of the United States’ trade with Russia. An oil boycott will push prices up further. That is the price the EU has to pay for its principle that Putin should be punished for what he is doing.”
An EU summit will be held in Brussels on Monday and Tuesday. Can Hungarian Prime Minister Viktor Orbán not be convinced?
“That would damage his reputation. In a letter, Orbán even asked European Council President Charles Michel not to discuss the oil boycott at all during the summit. According to Orbán, that would only be counterproductive. But the heads of government of the member states are free to decide for themselves which topics they will raise at the summit. I think there are definitely leaders who are going to discuss the boycott. That will not help the atmosphere.
‘As we speak people from the European Commission are still discussing the boycott with Hungary. The EU ambassadors will talk about it again on Sunday. I actually suspect that those negotiations will simply continue after the EU summit. That is also perfectly possible: the boycott does not have to take effect until the end of this year. There is no tight deadline.’
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