2022 – The European Union is close to reaching a compromise agreement on a partial Russian oil embargo | European Union

The European Union is close to imposing a partial Russian oil embargo as leaders try to find a compromise to please Hungarian Prime Minister Viktor Orban, who has blocked a deal over recent sanctions against Vladimir Putin’s war machine.

According to a compromise plan that will be discussed at the Brussels summit on Monday, Russian oil transported through the Soviet-era Druzhba pipeline to Hungary, the Czech Republic and Slovakia will be exempted from the EU embargo.

The European Union suspended its latest sanctions on Russia for nearly four weeks since European Commission President Ursula von der Leyen proposed a complete embargo on Russian oil by the end of the year.

On reaching the summit, Orban said that “the pipeline solution is not bad,” but insisted that his country needed guarantees that it could get oil from other sources in the event of an “accident” at the Druzhba pipeline, which runs through war-torn Ukraine. . In typical combative style, Urban attacked the commission for its “irresponsible behaviour” and accused it of creating a “difficult situation”.

Under a compromise designed by France, which holds the EU’s rotating presidency, EU member states will agree to most recent sanctions packages that include more restrictions on Russian banks, asset freezes for people close to the Kremlin and a ban on most Russian oil. .

Draft summit decisions, seen by the Guardian, describe the settlement as a “temporary exemption for pipeline-delivered crude”, with instructions for EU ministers to agree “as soon as possible” where the loophole can be closed.

The bloc has come under increasing criticism for slow progress on agreeing the latest, sixth sanctions package, including from Ukrainian President Volodymyr Zelensky, who will address the assembly via video link later on Monday.

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Chancellor Olaf Schultz said he was confident there was a “good solution” to the oil embargo, adding that he saw “a will to reach an agreement”. Germany, along with Poland, has pledged to phase out Russian oil by the end of the year. Officials close to the talks say the decision of these two major economies to abandon oil from the northern branch of the Druzhba pipeline means that the EU oil embargo will cover 93% of Russia’s oil supply by the end of the year.

So far, there is no expiration date for the exception to the southern extension of the Druzhba River, which includes Hungary, Slovakia and the Czech Republic, which are landlocked countries that rely heavily on Russian oil.

Budapest has already been offered a two-year delay in implementing the Russian oil embargo, but said that was not enough to allay its concerns about rising energy prices or foot the bill to modernize its refineries. A European diplomat hinted that it could take “a few weeks” to find a solution for countries that rely heavily on Russian oil.

Von der Leyen hampered hopes for a quick agreement: “My expectations are low that it will be resolved within the next 48 hours, but I am confident there is a possibility after that.”

Latvian Prime Minister Krisjanis Kariche has said he wants to warn his counterparts not to be “involved” in the details. “The big picture is that we have to starve Russia and Moscow of money to continue the war,” he said. “If every European country thought only of itself, we would never make progress.”

Italy, the Baltic states, the Netherlands, Belgium and other countries importing oil on tankers initially had concerns about a pipeline oil exemption that would give an advantage to countries that could continue to import cheaper Russian oil. But the willingness to accept imbalances in the EU’s internal market in order to agree on sanctions is growing.

“It would be better if everyone was on board,” said Estonia’s Prime Minister Kaja Kallas, but the withdrawal agreement “is still better than nothing,” adding that it fits each country’s moral compass.

Regardless of the sanctions, EU leaders are expected to approve 9 billion euros in emergency aid to Ukraine, although it has not yet been decided whether the money will be soft loans or non-repayable grants.

Ukraine will need hundreds of billions of dollars to rebuild destroyed schools, hospitals, housing and infrastructure. The European Commission proposed a jointly administered recovery body organized by Ukraine and the European Union with input from international institutions.

Some EU leaders are already talking about a seventh round of Russian gas sanctions. However, some argue that the EU launched an oil embargo too quickly. We talked about oil under pressure [the] “The Baltics and Poland are before we do our duty,” said a senior EU diplomat. β€œUnder the pressure of this war, we may have taken a few steps too soon and are now facing the consequences.”