Hungary has taken a firm position against the European Union by stating it will not accept a €90 billion financing plan that was designed to help Ukraine. This action makes an already tense oil disagreement much worse, which could affect how the EU works together and how Ukraine obtains money during the war.
The History of the Oil Dispute
The disagreement was sparked by Hungary’s heavy reliance on Russian oil, which flows through the Druzhba pipeline, a major route for energy supplies to Central Europe. Hungary, led by Prime Minister Viktor Orbán, has long been opposed EU plans to phase out Russian fossil fuels, warning that unexpected fines would harm its economy. Recent EU guidelines indicated that Hungary has to cut its imports of Russian oil by half in two years for grounds of energy security and independence in the world. Budapest called these efforts “economic blackmail” because they don’t take into consideration its landlocked location and lack of other pipelines.
The European Commission stopped granting Hungary €5 billion in cohesion grants last month because they were worried about the rule of law. This made the deadlock even worse. Orbán’s government replied by making it take longer to secure clearance for energy infrastructure projects in the EU. The €90 billion aid plan for Ukraine is presently in limbo. It was part of a bigger €110 billion multiannual program that was approved in late 2025. Hungary claims that the loan can’t go through until there are some changes to the rules about how oil may be shipped. The loan is being paid for by Russian assets that are frozen.
Hungary’s Strategic Strength
Orbán’s veto power in the EU Council gives Hungary a lot of say in things that everyone agrees on, like foreign aid. Experts suggest that this plan is like other impediments, like the delays in Ukraine’s talks to join and the sanctions packages. A diplomat in Brussels said, “Hungary is playing a high-stakes game.” “Orbán is putting the EU in a tough spot by linking energy security to aid for Ukraine. They have to choose between punishing Budapest or making Kyiv weaker.”
Hungary is in a strong position because it gets 70% of its crude oil from Russia. This is good for refineries like MOL’s Danube complex, which employs thousands of people. Politics at home are also important. Orbán’s Fidesz party says that the issue is about maintaining national sovereignty, which helps them get more votes before the 2026 elections. Allies in Vienna make things worse by echoing Hungary’s concerns and possibly becoming a blocking minority.
Germany strongly opposes the block and wants sanctions, even if this could make energy prices go up throughout the whole EU. Poland fully supports Ukraine and supports systems where the majority of people vote, which makes the Visegrád anti-Orbán front stronger. Austria still concerns about oil issues and might join a veto, which would make it tougher to acquire support. Italy remains out of it and works on accords over immigration. It might also help get an energy deal done.
The Foreign Minister of Ukraine called the block “irresponsible” because it strengthens Russia’s military machine. In February 2026, President Zelenskyy went to Budapest and talked to Orbán directly. He guaranteed that energy will be allowed to get through the Black Sea routes. But Orbán won’t change his mind. He wants the EU to officially stop Druzhba flows until 2035.
How it will affect Europe’s economy
The oil disagreement makes Europe’s energy difficulties worse following the crisis in 2022. Gas prices in the EU have stayed the same, but the Bruegel Institute says that problems with crude oil might add €20–30 billion to import expenses every year. The MOL Group in Hungary predicts that refineries might have to close, which might cause GDP to decrease by 5%. One of the biggest effects is that inflation will go up. If oil prices stay around €85 a barrel, inflation in the eurozone might rise by as much as 3.5%. Because of industrial strain, German carmakers and Hungarian drug businesses are having problems procuring the supplies they need. In the meantime, green hydrogen initiatives are moving more slowly because of delays in renewable energy projects that are connected to support for Ukraine.
Experts predict that if the problem isn’t fixed, the flow of Druzhba would reduce by 10 to 15 percent. This will mean that people will have to use more expensive LNG terminals in the Adriatic.
What the turmoil in Ukraine implies for politics around the world
Russia is stepping up its attacks on Dnipro, and a recent attack on a minibus killed 15 people. The €90 billion—€50 billion in loans and €40 billion in grants—will cover 30% of Ukraine’s budget in 2026. If there are delays, the delivery of F-16s and enhancements to Patriots might be stopped, which would upset the balance on the front lines. NATO leaders are concerned that things will become worse, and Putin is using Hungary’s position to make that happen.
People claim Orbán is in sync with the Kremlin because of his ties to Russia, including the nuclear deals in 2025. Critics point to WikiLeaks cables that show Budapest begging Moscow to decrease oil prices in exchange for ruining the EU. Hungary, on the other hand, insists this isn’t true and that it is neutral.
Hungary and the EU have a long history of fighting.
Orbán has been fighting for LGBTQ+ rights, media laws, and changes to the justice system since 2010. The EU has frozen €30 billion since 2022 and gained back €10 billion after striking deals. This oil issue is a new kind of conflict, utilizing energy as a weapon against unity.”Orbán’s Sovereignty Play” is an excellent example of how the story goes: Budapest sees itself as a defender against Brussels’ overreach, which appeals to populist supporters all throughout Europe.
Voices from the Ground
Five thousand protesters rallied outside the parliament building in Budapest and yelled, “No to Russian Oil.” MOL workers protested to maintain their employment. Ukrainian expats living in Brussels asked people to stop buying Hungarian goods. Jan Techau of Carnegie Europe says that expert criticism underscores the necessity for action: “This could lead to the EU’s collapse at Ukraine’s expense.”” Hungarian Péter Szijjártó adds, “Compromise on oil buys time for diversification.”
The figures are extremely clear: Ukraine has gotten €120 billion in aid since 2022, with the €90 billion being the highest single payment. Every year, Druzhba exports 16 million tons of commodities to Hungary, Austria, and Slovakia. EU blocked assets include €300 billion in Russian assets set aside for war reparations.
Ways to Find an Answer
Bilateral energy agreements between Ukraine and Hungary or moving money around in the ESIA budget are only short-term fixes. Long-term, the Adria pipeline additions that have been put off until 2028 will make things more independent. In March 2026, EU leaders will get together to debate about “emergency aid mechanisms.”
Hungary’s veto is waived so that €2 billion in oil subsidies and aid terms that can’t be stopped can go through. Orbán’s math at home will determine whether or not he accepts.
Hungary stops Ukraine from getting a €90 billion loan from the EU. Because of a Dispute Over Oil
