Despite EU sanctions and efforts to reduce reliance on Russian energy, Hungary maintains its dependence, citing economic necessity and infrastructural challenges, amidst calls for a strategic diversification towards LNG and alternative pipelines.
Hungary remains a significant holdout in Europe’s broader effort to sever ties with Russian energy, maintaining its reliance on Russian oil and gas despite mounting pressure from the European Union and NATO to cut such dependencies following the Russian invasion of Ukraine in 2022. Prime Minister Viktor Orbán, whose government is often described as populist and has the closest ties to Moscow among EU leaders, insists that Russian energy imports are crucial to Hungary’s economy and that alternatives are either insufficient or economically damaging.
Orbán has repeatedly warned that severing Russian energy supplies would cause immediate economic harm. Speaking to state media, he stated that cutting off Russian oil and gas would cause Hungary’s economic performance to drop by 4% within minutes, describing the potential fallout as catastrophic and leaving Hungary “on its knees.” His government has framed Hungary’s dependence as a matter of geography and infrastructure, pointing to the landlocked nature of the country and its reliance on Soviet-era pipelines such as the Druzhba, which transports much of Hungary’s crude oil, and the TurkStream pipeline for gas imports.
However, energy experts and critics challenge Orbán’s position as more politically motivated than practically unavoidable. Analysts argue that existing infrastructure, including the Adria pipeline from Croatia’s Adriatic Sea, provides tangible alternatives to Russian oil. The Adria pipeline has capacity to supply significant volumes of crude oil, with the Croatian transport company Janaf claiming it can meet the total annual oil demand of Hungary and Slovakia together. A former MOL executive and chemical engineer, László Miklós, dismissed the government’s claims of infrastructural incapacity as misleading and suggested Hungary’s continued Russian energy purchases are a deliberate political choice aimed at supporting Russia financially. Miklós pointed out that while the Hungarian national oil and gas company MOL claims to require around 14 million tons of crude annually, it is feasible to significantly reduce imports from Russia by using the Adria pipeline combined with the Druzhba pipeline.
The EU has actively worked to cut Russian energy revenues, introducing a 2022 oil embargo and proposing a full phase-out of Russian oil and gas imports by 2027. Hungary, along with Slovakia and the Czech Republic, was granted a temporary exemption due to logistical complications from being landlocked. However, while the Czech Republic has successfully shifted to alternative sources, Hungary has not followed suit. Hungarian officials have vehemently rejected the idea that it could do so without severe economic consequences, framing the EU measures as ideologically driven and impractical for Hungary’s specific circumstances.
Borbéla Takácsné Tóth, a gas research analyst, notes that the price difference for Hungarian gas sourced from Russia is not markedly cheaper than non-Russian alternatives on European markets. Her institution’s modelling suggests that breaking with Russian gas would result in only a modest price increase of approximately 1.5 to 2 euros per megawatt hour, a price change under 5% and therefore economically manageable. Despite political resistance, the national energy company MOL has been investing heavily—around $500 million—in diversifying its supply channels and modernising refineries to process non-Russian crude, aiming to increase flexibility by 2026.
Moreover, Hungary has begun signing new deals to diversify its gas imports, including its largest-ever liquefied natural gas (LNG) agreement with French company Engie, which covers 400 million cubic meters annually from 2028 to 2038, representing about 5% of Hungary’s gas consumption. This follows an earlier LNG supply deal with Shell. However, Hungarian officials emphasise that these moves are intended to enhance energy security and are not a rejection of Russian supplies, which remain stable and substantial. Hungary signed a 15-year gas deal with Russia in 2021 and imported a record 5 billion cubic meters via TurkStream by August 2025.
Hungary’s diplomatic stance remains at odds not only with the EU’s broader sanctions but also with neighbouring Ukraine. The relationship between Budapest and Kyiv has sharply deteriorated, exemplified by Hungary’s recent move to block access to 12 Ukrainian news websites in retaliation for Ukraine banning Hungarian-language media, on grounds of alleged pro-Russian bias. The Hungarian government defends these actions as proportionate responses but they underscore the broader political tensions at play.
The United States, while pressing the EU to intensify its embargo on Russian fossil fuels, has granted Hungary an exemption from sanctions related to gas payments through Gazprombank, acknowledging Hungary’s continued reliance on Russian energy. Hungarian Foreign Minister Péter Szijjártó welcomed this exemption but noted that alternate payment mechanisms compliant with sanctions have already been developed.
Despite Hungary’s current stance and political resistance to EU initiatives, analysts underscore that the EU’s regulatory environment and geopolitical pressures will increasingly limit the country’s ability to maintain its dependence on Russia. The era of easy Russian energy imports is drawing to a close, as the EU commits to sanctions targeting niche fuels and pipeline supplies, alongside expanding LNG imports from global markets. This broader European pivot away from Russian energy places Hungary at a crossroads between its political allegiances and the practical demands of energy security and market integration.
In sum, while Hungary clings firmly to Russian oil and gas imports—citing economic necessity and infrastructure constraints—the realities of existing diversification options, EU sanctions frameworks, and international diplomatic pressures suggest that this reliance is as much a political stance as an economic imperative. The country’s gradual moves toward LNG diversification signal potential shifts ahead, but for now, Hungary remains one of the clearest exceptions in Europe’s energy realignment following the war in Ukraine.
Source: Noah Wire Services
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