Budapest has blocked a crucial €90 billion European Union loan package for Ukraine, linking its approval to the restoration of Russian oil transit through Ukrainian territory—a move that threatens to deepen divisions within the bloc over support for Kyiv.
The loan package, designed to cover Ukraine's budgetary and military needs through 2027, had been unanimously endorsed by EU leaders in December 2025. However, Hungarian Prime Minister Viktor Orbán is now conditioning final approval on Ukraine resuming flows of Russian crude through the Druzhba pipeline to Europe.
European Commission spokesperson Balázs Ujvári expressed Brussels' expectation that all member states would "honour the political agreement" reached last December. "The European Commission had adopted a legislative package on 14 January based on this agreement," Ujvári stated, emphasizing that member states should "honour this political agreement in order to ensure the final approval."
To understand today's headlines, we must look at yesterday's decisions. The current impasse stems from Ukraine's refusal to facilitate Russian oil exports after Moscow damaged portions of the Druzhba pipeline infrastructure during its ongoing military campaign. Kyiv has proposed an alternative: using the Odesa-Brody pipeline to deliver crude to Hungary and Slovakia.
The Hungarian position has found support—or at least parallel resistance—from Prague and Bratislava. Both Slovakia and the Czech Republic have also declined to participate in the EU loan scheme, though their opposition appears less explicitly tied to the oil transit question.
This is not the first time Orbán's government has leveraged EU consensus requirements to extract concessions on energy or Ukraine policy. In 2022, Budapest secured exemptions from Russian oil sanctions, and it has repeatedly delayed or watered down EU support packages for Ukraine.
The €90 billion package represents a significant escalation in the stakes, however. The funds are essential for Ukraine to maintain basic government functions and military operations as the war enters its fourth year. European officials had viewed the December agreement as a breakthrough, providing predictable multi-year financing rather than the piecemeal support that has characterized much of the EU's response.
Analysts note that Hungary's position creates a dangerous precedent: a single member state using its veto power to subordinate collective security commitments to bilateral disputes over commercial interests. Whether Brussels can find a mechanism to circumvent Budapest's obstruction—as it has done with previous sanctions packages—will test the EU's institutional flexibility and political resolve.
