EU’s Russian oil ban hits the skids after right-wing leader Viktor Orbán compares sanctions to ‘atomic bomb’

Hungary looks set to put a stop to the European Union’s ban on Russian oil imports after leader Viktor Orbán compared the proposal to an atomic bomb.

European Commission President Ursula von der Leyen announced proposals on Thursday that would see EU member states banned from buying Russian crude oil within six months and prohibit them from importing refined Russian oil products by the end of the year.

“With all these steps, we are depriving the Russian economy of its ability to diversify and modernize,” she said in a speech. “Putin wanted to wipe Ukraine from the map…[but] it is his own country, Russia, he is sinking.”

But the bloc’s plans face a major obstacle.

In order to implement economic sanctions against any country, the EU needs approval from all 27 of its member states—and the current proposals have already met staunch resistance from Hungary’s right-wing leader, Orbán.

Hungary is heavily dependent on energy imports from Russia, and Orbán has repeatedly insisted that an embargo on Russian energy would be a red line for his country.

Bloomberg reported on Friday that the EU had proposed revising the ban on Russian oil to give Hungary and Slovakia—which is also greatly reliant on Russian energy—until the end of 2024 to comply with the sanctions.

It had earlier been reported that the two countries had been offered an extension to allow them to continue purchasing Russian crude until the end of 2023.

But even with exemptions for the two nations, the EU is facing pushback from the Hungarian and Slovakian governments, who could veto the sanctions plan.

In an interview with Hungary’s Kossuth Radio on Friday, Orbán said Brussels’ proposed Russian oil ban amounted to “an atomic bomb,” arguing that the move posed a direct threat to energy security.

“The proposal on the table now creates a Hungarian problem, and there is no plan to solve it,” he said. “With this move, the Commission has disrupted hard-established European unity, and in war, this has serious consequences.”

Orbán told Kossuth Radio it would take at least five years for Hungary to transition away from Russian oil, adding that it would cost hundreds of billions of Hungarian forints to rebuild the country’s oil refinery system.

His interview came after Orbán wrote to Von der Leyen to outline his concerns about the impact banning Russian oil imports would have on Hungary’s economy.

Meanwhile, Slovakia’s economy minister Richard Sulik told reporters this week that it would take several years for the country’s only oil refiner, Slovnaft, to replace Russian crude with oil sourced from elsewhere.

“So, we will insist on [an] exemption, for sure,” he said, according to the Associated Press.

According to the International Energy Agency, Russia supplied 59% and 92% of Hungary and Slovakia’s crude oil and oil products respectively last year.

In comparison, Germany sourced 37% of its crude and oil products from Russia in 2021, while 13% of France’s were Russian.

Europe was already grappling with an energy crisis before Russia invaded Ukraine.

Tight natural gas supplies prompted wholesale gas prices in the region to surge to record highs last year, with energy prices helping push annual inflation across the EU up to 7.8% in March.

Tim McPhie, a spokesperson for the European Commission, told a press briefing in Brussels on Friday that the EU is considering whether adding conditions to the sanctions package to get it approved could impact the oil ban’s efficacy.

“If you’re looking at accommodating certain member states in a certain way, you have to look at the fact that they are a very small percentage of the overall imports from Russia,” he told reporters.

At the same briefing, Eric Mamaer, chief spokesperson of the European Commission, said the EU was continuing to engage in discussions with member states over the proposed sanctions and had held “intense consultations” with member nations before the proposals were put forward.

Sign up for the Fortune Features email list so you don’t miss our biggest features, exclusive interviews, and investigations.

Read More

Ukraine InvasionCybersecurityEnergyTravel IndustryAutos