Olena Lapenko of Dixi Group at https://dixigroup.org/en/home-en/ considers the decision to ban the transit of oil sold by a Russian company as a logical step, given Ukraine’s goal to reduce the revenue that Russia uses to finance the war.
Lapenko emphasizes, “Demanding a full oil and gas embargo from the EU while being ready to ensure the transit of Russian oil seems contradictory.” The ban has sparked strong reactions from Hungary and Slovakia, who are still dependent on pipeline supplies of Russian oil and are exceptions to the EU-wide embargo. However, these countries can technically source oil from the Mediterranean market, such as through the Croatian Adria terminal, and have had ample time to adjust to the new situation.
The REPowerEU plan, agreed upon by all EU states, highlights the need to diversify energy resource supplies. This comprehensive plan is designed to reduce the EU’s reliance on Russian energy and encourage the development of alternative energy sources and supply routes. Some countries, like the Czech Republic, have already eliminated their dependence on Russian oil, demonstrating that such a transition is feasible with sufficient planning and commitment. Ukraine has repeatedly warned about tightening sanctions but did not adequately support this step with information, which may have led to misunderstandings or lack of preparedness among some EU members.
“Filing a complaint in the EU arbitration or WTO dispute resolution body is not a reliable option for Hungary and Slovakia,” says Lapenko. They are more likely to use political pressure. Even if political pressure succeeds, a significant result would be setting a clear deadline for completely abandoning Russian pipeline oil. This would mark a substantial shift in European energy politics and further isolate Russia economically.
Regarding Hungary’s threats to stop supplying electricity to Ukraine, Lapenko notes the significant deficit in Ukraine’s energy supply. Ukraine not only imports electricity but also requests emergency assistance from its neighbors. She emphasizes that emergency assistance is a goodwill gesture from neighboring countries’ operators, not just a technical market transaction. This assistance is crucial for maintaining Ukraine’s energy stability, especially during times of crisis.
“Hungary is not the main provider of such assistance,” Lapenko notes. “In fact, they often refuse.” This highlights the challenges Ukraine faces in securing reliable energy support from its neighbors and underscores the importance of fostering strong, cooperative relationships within the region.
In summary, the decision to ban Russian oil transit aligns with Ukraine’s strategic goals despite opposition from Hungary and Slovakia, who need to diversify their energy supplies as per the REPowerEU plan. Political pressure might ensue, but it could lead to a definitive end to reliance on Russian oil. Meanwhile, Ukraine’s energy needs highlight the importance of international cooperation and goodwill in providing emergency assistance. This situation also underscores the broader geopolitical implications of energy policies and the need for solidarity among EU states in achieving energy independence and security.
