EU may reach deal on Russian oil ban ‘in a matter of weeks’, Ursula von der Leyen tells Euronews

A deal on a stalled proposal to introduce an EU-wide ban on Russian oil imports could be reached “in a matter of weeks,” said European Commission President Ursula von der Leyen, who is one of the staunchest advocates behind the measure.

Von der Leyen unveiled the proposed embargo earlier this month, suggesting up to six months to phase out purchases of Russian crude oil and until the end of the year to stop buying all refined oil products.

But soon after her announcement, several member states, including Hungary, Slovakia, the Czech Republic and Bulgaria, raised concerns and asked for tailor-made exceptions to have more time to adapt their refineries and cushion the economic impact.

Several rounds of intense negotiations have failed to deliver the much-needed breakthrough, with Hungary emerging as the main and most vocal opponent.

“We’re working hard on it because we have a few member states that really have technical problems. They are landlocked so they cannot get the oil via the sea. They need alternatives and pipelines, and they need work on updating their refineries,” von der Leyen told Euronews at the World Economic Forum in Davos.

“Here, we’re working hard to find technical solutions. Solidarity solutions from other member states, but also the financial investment into, for example, renewables,” she added.

“It’s a complex mechanism. I hope that we’re done with that in a matter of weeks.”

Von der Leyen’s optimistic assessment echoes the words of German Vice-Chancellor Robert Habeck and Dutch Prime Minister Mark Rutte, who have also indicated a deal was imminent.

However, in a letter seen by the Financial Times, Hungary’s Prime Minister Viktor Orbán has asked the proposed oil embargo to be excluded from next week’s EU summit, where diplomats had hoped a political solution could be found.

“Discussing the sanctions package at the level of leaders in the absence of a consensus would be counterproductive,” Orbán wrote in the letter.

“It would only highlight our internal divisions without offering a realistic chance to resolve differences. Therefore, I propose not to address this issue at the next European Council.”

Reacting to the news, an EU official said the Council was consulting with “all leaders” to prepare and define the two-day summit’s agenda.

‘We have to step up’

With the war showing no signs of abating, the Commission presented last week an ambitious plan to facilitate the transition away from Russia’s most profitable exports: fossil fuels.

The EU’s years-long effort to achieve energy independence from Moscow will cost €210 billion.

Brussels says it’s possible to rise up to €300 billion by the end of this decade through a combination of financial instruments, such as the bloc’s coronavirus recovery fund, the common budget and the revenues obtained from the Emissions Trading System (ETS).

“95% [of the money] is going into renewables,” said von der Leyen, dismissing concerns raised by civil society that using cash from the ETS will encourage the burning of more fossil fuels.

“As paradox as it is, but this war and the behaviour of Russia and our will to really get rid of the fossil fuel dependency on Russia, accelerates the European Green Deal. It’s good that we have it in place,” she noted. “But we now have to step up and accelerate.”

Notably, the Commission’s plan, dubbed RePower EU, earmarks up to €2 billion to revamp oil systems but most of the money can only be accessed through unused loans from the recovery fund.

Hungary’s national recovery package, submitted in May 2021, has not yet been approved by Brussels due to long-standing concerns related to the rule of law that, in the executive’s view, remain unaddressed.

As part of the negotiations around the oil embargo, Hungary has requested an unspecified amount of money in exchange for its green light. EU sanctions require the unanimous consent of all member states.

The country’s foreign affairs minister, Péter Szijjártó, had previously said slashing Russian oil would necessitate investments worth between €500 and €550 million, in addition to €200 million to boost the Adria pipeline.

Diplomatic sources consulted by Euronews say there is growing fear that Budapest is trying to capitalise on the oil impasse to force the approval of its recovery package.

‘Russia is responsible for food crisis’

In an interview with Euronews, von der Leyen accused Russia of provoking a world food crisis as a result of the invasion of Ukraine, one of the world’s leading exporters of wheat, corn, barley and sunflower oil.

Russia has managed to control most of Ukraine’s access to the Black Sea, effectively imposing a blockade that prevents Ukrainian ships from bringing food supplies to global markets. The restrictions have dealt a huge blow to the nation’s economy and raised the alarm among low-income countries.

“No possibility should be [left] unused to have a dialogue with Russia” to solve the situation, said von der Leyen. “It cannot be that Russia is already responsible with the war for this food crisis, but that now it is knowingly blocking the Black Sea and thus responsible for the starvation of millions of people.”

“There are discussions with Russia, so that’s good, in unblocking the Black Sea,” she added.

Kyiv has asked the EU and the G7 to set up green corridors to allow food supplies to leave Ukraine via alternative land routes. The country is currently storing around 40 million tonnes of grain, half of which must be exported by the end of July.

“We’re working hard with the Ukrainians to help them bring out the wheat for example, through trucks or trains, and other transport modes. This is not easy but we’re working on all fronts,” von der Leyen said.

The Commission chief plans to host an event on food security with President Abdel Fattah el-Sisi of Egypt, one of the most exposed countries to the food disruption caused by the war.