Sanctions / Russia: Drogba, the pipeline blocking the EU agreement

The war in Ukraine – the pebble in Brussels’ shoes looks like a stumbling block. Representatives of the 27 countries discussed a new proposal on Sunday (May 29) that would temporarily exempt a major oil pipeline for Hungary from the European Union’s gradual embargo on Russian oil. It is an attempt to reach consensus and approve the sixth package of sanctions against Moscow, on the eve of the European summit that begins on Monday in Brussels.

This proposal by the European institutions and France, which holds the rotating presidency of the European Union, provides for a ban on Russian oil delivered by boat by the end of the year, except “for the time being” sent through the Druzhba oil pipeline. (which means “friendship” in Russian), which supplies Hungary, Slovakia and the Czech Republic in particular, is indicated in the delegation accompanying the Committee. A European source confirmed that “the question of Drogba will be addressed again quickly.”

Negotiations are underway, Borrell confirms that “there will be an agreement”

Franceinfo guest On Monday, May 30, the head of EU diplomacy Josep Borrell has already considered that the main thing is to reach a consensual agreement, so that the sanctions come into force. “In the end, we will have an agreement,” he declared, rejecting the idea of ​​an embargo in favor of “stopping the purchase of Russian oil.” It is clear that Europe is turning to another model while Russia is being deprived of some of its financial resources in the process.

Josep Borrell emphasized again: “We have to decide unanimously so that there are negotiations, and I believe that this afternoon we will be able to present an agreement to the heads of state and government.” Let’s be practical: landlocked countries including Hungary, Slovakia and the Czech Republic account for about 7.8% of European imports of Russian oil. We need to give them more time to adapt.”

Because in fact, if Budapest in particular is preventing a complete moratorium on imports for the time being, it has its reasons. Hungary, a landlocked country that does not border the sea, depends for 65% of its consumption on oil transported from Russia via Druzhba. So she is against a pipeline ban and has rejected the first offer of a two-year exemption. Budapest has requested at least four years and about 800 million euros in European funding to adapt its refineries.

Complex location of the European Union opposite Budapest

In a context where Budapest’s post-Covid recovery plan is still blocked by Brussels due to violations of the rule of law in Hungary (in particular due to discriminatory laws against the LGBT community), it seems difficult to give it money. The new proposal submitted to the ambassadors of member states on Sunday was not agreed upon, and a new meeting will be held on Monday morning before the opening of the summit scheduled for 4:00 p.m., which is scheduled to end on Tuesday noon.

Currently, the exemption poses, among other things, a “fairness problem” between countries in their oil purchases, which some have raised, according to this source. “I hope we can reach an agreement tomorrow, but I’m not sure it will depend on the leaders themselves,” said a European diplomat. Let us remember that the adoption of sanctions requires the unanimity of the 27 countries.

“By targeting seaborne oil, we will hit at least two-thirds of Russia’s oil exports,” the European official said. EU sanctions aim to cut off funding for Russia’s war effort against Ukraine. For the EU, the Russian oil import bill (€80 billion) was four times larger than the gas bill in 2021.

Full set of penalties

However, Thomas Bellerin-Carlin of the Jacques Delors Institute points out that “a limited ban that excludes oil pipelines will be much less painful for Putin’s Russia, because finding new customers supplied by tankers will be much less difficult.” Ukrainian President Volodymyr Zelensky is scheduled to speak at the start of the summit via video conference, as Kyiv pressures Westerners to “kill Russian exports” more than three months after the attack.

In addition to the oil embargo, the sanctions package is also aimed at excluding Russia’s largest bank, Sparkank (37% of the market), and two other banking institutions from the international financial system SWIFT, as well as expanding the blacklist of Russian banks. The European Union to about sixty people.

Leaders should also discuss the need to ensure Ukraine’s liquidity to keep its economy running (the Commission has proposed aid of up to 9 billion euros in 2022) as well as food security, due in particular to blocking Ukraine’s grain exports, while African nations fear the continent from a crisis.

The reconstruction of Ukraine, in which the EU wants to play the leading role, will also be on the agenda. Kyiv recently estimated the damage (roads and infrastructure) at $600 billion.

See also on HuffPost: Total in Russia? We asked the contributors about the invasion of Ukraine

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