Hungary presses for pipeline exemption from Russian oil embargo

Energy Trade

Russian-language sign with words "Druzhba oil pipeline" in the Carpathian region of Ukraine, May 2021.

Photo by Dmytro Falkowskyi / Shutterstock.com

Hungary will push for an exemption of pipeline deliveries from an embargo on Russian oil proposed by the European Commission, Minister of Foreign Affairs and Trade Péter Szijjártó said in a video message posted on social media on Wednesday, according to a report by state news wire MTI.

Speaking from Malaga, Spain, where he attended a United Nations counter-terrorism conference, Szijjártó noted that Prime Minister Viktor Orbán had discussed in recent days the EC's proposed phase-in of a complete oil embargo with EC President Ursula von der Leyen and French President Emmanuel Macron.

"These talks have made it clear to us that that there is...no proposal on a solution from the European Commission that could manage the possible nuclear bomb-like impact that an embargo on Russian oil would have on the Hungarian economy," he said.

"That's why we consider it realistic to return to the original Hungarian proposal made when the European Commission presented the idea of the oil embargo. We said then, too, that the introduction of an embargo would be realistic only if applied to deliveries by sea...[while] pipeline deliveries are exempted entirely," he added.

"If Brussels is seriously weighing the introduction of the embargo, that will only be possible if pipeline deliveries are exempted," he said.

"We will take this position this week, too, at talks in Brussels and elsewhere," he added.

Szijjártó said a blanket embargo on Russian oil would "completely ruin" Hungary's secure energy supply, causing "enormous damage".

The measure would raise vehicle fuel prices "55-60%" and bring prices at the pump to "at least" HUF 700/l for gasoline and HUF 800/l for diesel, according to experts, he added.

"We made it clear to the European Commission that we can only vote for this proposal if Brussels proposes solutions for the problems Brussels has created," he argued.

He added that those solutions need to address not only the "several hundred million dollars" required to refit refineries and the "several hundred million dollars" needed to expand crude pipeline capacity from Croatia, but also an upgrade of Hungary's entire energy supply structure that would run into "the billions of euros".

Landlocked Hungary gets close to two-thirds of its oil from Russia, via pipeline, and the country's main refinery is technically reliant on Russian crude.

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