Hungary seeks new routes for Russian oil imports amid Ukrainian sanctions on Lukoil
Hungarian oil and gas company Mol has proposed a new scheme to transit Russian oil through Ukraine, under which Mol would take on responsibility for the supplies, according to the Russian news agency RBC. As Gergely Gulyás, Chief of Staff for Hungarian Prime Minister Viktor Orbán, told reporters, Mol is currently in discussions regarding this arrangement. Gulyás noted that while the new scheme would be more expensive and risky, it is part of Mol's efforts to find alternative solutions, as Lukoil can no longer supply oil due to sanctions.
The details of the discussed plan remain undisclosed. Following Russia's full-scale invasion of Ukraine, the European Union banned the import of Russian oil and petroleum products transported by sea. The initial embargo did not include pipeline oil, allowing continued supplies through the Druzhba pipeline's two branches from Russia to Europe. But in June 2023, deliveries via the northern branch (through Belarus to Poland and Germany) were prohibited, leaving only the southern branch (through Ukraine to Slovakia, Czech Republic, and Hungary) operational.
Under a contract with Hungarian Mol, Lukoil was supposed to supply 4 million tons of oil annually through the southern branch of Druzhba until 2025. However, the National Security and Defense Council of Ukraine expanded sanctions against Lukoil in June this year to include oil transit, bringing Lukoil's supplies to a halt.
Both Mol and Slovakia's Transpetrol have stopped receiving oil from Lukoil. "A legal situation in Ukraine has arisen, preventing Lukoil from continuing deliveries to Hungary," said Hungarian Foreign Minister Péter Szijjártó. Meanwhile, Ukrainian Naftogaz stated that Hungary, Slovakia, and the Czech Republic are still receiving Russian oil from other companies.
Hungary and Slovakia have appealed to the European Commission to investigate the issue. Szijjártó indicated that Budapest would block financial aid to Ukraine from the European Peace Facility until the oil supply question is resolved. The European Commission, however, has not identified any risks. "Based on our analysis, Ukraine's sanctions against Lukoil do not affect transit through the Druzhba pipeline if the owner of the oil is not Lukoil," said commission spokesperson Balázs Ujvari.
Szijjártó has accused the European Commission of inaction and even suggested a conspiracy against Hungary and Slovakia. "Perhaps Brussels, rather than Kyiv, orchestrated this; it was the European Commission, not Ukrainian authorities, that wanted to blackmail the two peace-promoting countries declining to supply weapons," he wrote on his Facebook page in late July.