Brussels (The Brussels Morning Newspaper) – The European Commission has declined to mediate between Hungary, Slovakia, and Ukraine concerning the sanctions Kyiv imposed on the Russian oil company Lukoil, according to an EU spokesperson. This decision leaves the two EU member states without any external backing from Brussels.
Why Did the European Commission Refuse to Mediate the Dispute?
The European Commission has rejected Hungary and Slovakia’s request that it negotiate a consultation procedure with Ukraine over sanctions imposed by Kyiv on Russian oil producer Lukoil (LKOH.MM). “Commission services have preliminarily concluded that urgent consultations do not appear to be warranted,” the spokesperson stated.
The spokesperson expressed Brussels had no indication Ukraine’s sanctions had rendered a risk to European security of energy supplies, since Russian oil was still flowing through the Druzhba channel that links Russia, via Ukraine, to the Czech Republic, Slovakia and Hungary. “It appears that the sanctions imposed by Ukraine on Lukoil do not involve ongoing oil transit operations via Druzhba carried out by trading businesses, as long as Lukoil is not the legal owner of the oil,” the spokesperson stated.
How Is the Lukoil Sanctions Dispute Affecting European Energy Security?
Ukraine’s sanctions on Lukoil have problematized Hungary and Slovakia’s ability to import Russian oil, a critical supply route for both countries. Hungary imports 70% of its oil from Russia, with about half of that arriving from Lukoil. This amounts to 2 million tons of crude annually, substituting one-third of Hungary’s oil imports. Foreign Minister Péter Szijjártó noted that Ukraine’s goal is to cut off one of the Kremlin’s primary revenue streams, particularly crucial over two years into Russia’s full-scale invasion of Ukraine. However, Hungary’s reliance on Russian oil raises fears of supply shortages.
Slovakia and Hungary – two nations that have opposed Western allies’ military aid to Ukraine as it fights Russia’s invasion – have complained to Brussels about Kyiv’s move to put Lukoil on its sanctions list, saying it stopped them from purchasing Russian oil for their refineries, endangering the security of supply.
Hungarian Prime Minister Victor Orban’s spokesperson did not immediately react to a request for comment. Hungary supplied additional information on the issue to the EU Commission this week, which the EU Commission stated it will now analyse. The Druzhba oil pipeline has remained functioning following Moscow’s attack on Ukraine in 2022, even as the EU weaned itself off most other sources of Russian energy.
