Oil Sanctions, Challenges for Hungary, and the EU's Subtle Power Moves

With the upcoming renewal of EU sanctions on Russia in July, Brussels is devising a workaround for Hungary, particularly Viktor Orbán, who has threatened to withdraw unless his demands are met.

Renewing sanctions typically requires unanimous consent from all 27 EU member states, which has become tricky due to Orbán's close ties with Vladimir Putin and his use of sanction votes to gain unrelated concessions. As a solution, the European Commission is considering reclassifying the sanctions as trade measures, which only need a qualified majority. This would allow the rest of the bloc to proceed without Hungary's involvement.

Oil remains a key issue, with EU sanctions reducing Russian Baltic oil shipments by about 10% recently. These import bans, along with technology and aluminum restrictions, have been vital in limiting Moscow's military capabilities. Hungary, however, continues to defend Russian interests until it receives better energy terms, at which point its objections seem to disappear.

If the Commission's strategy works, they could renew sanctions without Orbán obstructing the process, helping maintain the EU's leverage over Russian oil while Russian revenues remain unexpectedly strong.

While most EU countries are seeking alternative gas sources, some, especially Slovakia and Hungary, have expressed concerns about the potential increase in costs.

With Trump back in the White House, the EU may need to utilize every procedural option available to maintain pressure on Moscow without causing internal divisions.

Consequently, the EU might stop accommodating Hungary's veto power, which could keep Russian oil out of European markets.