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EU leaders appear to be closing in on a deal to water down proposed sanctions on Russian oil in an attempt to bring Hungary on board, according to diplomats and draft summit conclusions seen by POLITICO.
Slapping an embargo on Russian oil would be one of Europe’s most significant steps in restricting Russian President Vladimir Putin’s income and his ability to wage war in Ukraine, but the proposed ban has met fierce resistance from Hungary, which says its economy would be hammered by the move. This opposition from Hungarian Prime Minister Viktor Orbán now means that the EU is likely to avoid a “complete” oil ban.
Instead, the compromise under discussion is to allow Russia’s pipeline oil exports to the EU to continue temporarily, while seaborne shipments are blocked. Such a move would hit some 70 percent of Russian oil exports to the EU, which arrive by tanker. Diplomats say, however, that the measure will ultimately affect just over 90 percent of Russian sales to the EU because of previous German and Polish pledges to dispense with Russian crude.
Suggesting that a deal could finally be possible after almost a month of bickering, Orbán — the main-hold out — said that the idea of the carve-out for pipelines was “not bad.”
That does not mean, however, that a deal is yet in the bag. Speaking to reporters as he entered the European Council summit in Brussels, Orbán said the latest offer is “a good solution for Hungary,” but insisted Budapest will still fight for a guarantee that if “something happens” to its pipeline oil, it would retain the right to get oil via maritime and other routes.
“We need a guarantee that in the case of an accident with the pipeline … we have to have the right to get Russian oil from other sources,” Orbán said. “If we get it, it’s fine.”
European Commission President Ursula von der Leyen said the oil compromise had “matured” but reckoned a breakthrough was not imminent. “My expectations are low that it will be solved in the next 48 hours but I’m confident that thereafter there might be a possibility,” she said.
German Chancellor Olaf Scholz struck a slightly more optimistic note. “I am firmly convinced that today, tomorrow we can debate further for a good solution…. There is every indication that we will come together — no one can predict whether this will actually be the case, but everything I hear sounds as if there could be a consensus,” he said
The compromise plan on pipelines, first reported by POLITICO last week, would represent a weakening of the European Commission’s original proposal for a “complete ban” on Russian oil imports.
The wording was settled during talks among envoys on Monday morning and will now be sent to EU heads of state and government to discuss at their meeting.
The leaders — who include Hungary’s Orbán — may not agree to it and even if they do, much more work will be needed on the details before any sanctions can come into force.
The compromise on pipelines would help landlocked countries such as Hungary, which has blocked an agreement on banning imports of Russian crude and refined fuels on the grounds that such action would deliver a severe blow to its economy.
The draft summit conclusions state the “European Council agrees that the sixth package of sanctions against Russia will cover crude oil, as well as petroleum products, delivered from Russia into Member States, with a temporary exception for crude oil delivered by pipeline.”
The package has to ensure fair competition and a level playing field in the EU single market and solidarity among EU countries in case of sudden interruptions of supply, the text reads.
The draft conclusions don’t mention a specific timeline for the temporary exception for crude oil delivered by pipeline, stating the exemption should end “as soon as possible.”
An EU diplomat said that a lot of progress on the package was made Monday morning, but that further technical work is needed. “The goal is to have a political deal today,” the diplomat said. Two senior EU diplomats said it was now up to leaders whether or not they adopt the language as hammered out by EU ambassadors.
If EU leaders agree on a political deal on the package, the Council of the EU will still have to formally agree on the sanctions. One diplomat expressed doubts about whether leaders would sign up to the language as it stands, while another said the wording was so broad it didn’t mean much as many of the arguments over details remain unresolved.
Russia supplies about a quarter of the EU’s crude oil, according to Eurostat figures.
Dutch Prime Minister Mark Rutte disagreed that excluding pipeline supplies represented a major step-back from the original goals to starve Putin’s war machine of cash.
“I don’t think we are watering down,” Rutte said before entering the meeting. The proposed measure would still hit two-thirds of Russia’s oil exports, he added.
David M. Herszenhorn and America Hernandez contributed reporting.
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Soruce : https://www.politico.eu/article/eu-moves-step-closer-to-deal-on-russian-oil-embargo/