European Union envoys convened on Wednesday in Brussels, with a majority cautiously optimistic that a massive loan to support Ukraine's military and financial needs over the next two years may soon be approved after months of deadlock. The 90-billion-euro ($106 billion) loan package is desperately needed by Ukraine to prop up its war-ravaged economy and help keep Russian forces at bay.
Hungary's Veto and Pipeline Dispute
Hungary has insisted that it must start receiving supplies of Russian oil again via Ukraine before it will unblock the funds. Hungary and Slovakia rely on Russian oil to meet their energy needs and have both accused Ukraine of failing to repair a damaged pipeline that ships the oil. Ukraine and most of its European backers oppose imports of Russian oil, which have helped to fund President Vladimir Putin's war, now in its fifth year.
Ukraine Completes Pipeline Repairs
In a social media post on Tuesday, President Volodymyr Zelenskyy announced that Ukraine has completed repairs on the Druzhba pipeline, which was damaged by a Russian strike, and that the pipeline can resume operation. However, outgoing Hungarian Prime Minister Viktor Orbán has signaled that he would only approve the Ukraine loans once the oil starts flowing again. Orbán, who lost an election on April 12 and is due to leave office next month, has repeatedly blocked EU aid to Ukraine.
Written Procedure for Approval
Cyprus, which currently holds the EU's rotating presidency, intends to launch a written procedure to approve the final piece of the loan package. This would require Hungary or any other objecting nation to state in writing why they oppose it. Such procedures are often left open for 24 hours or more, and final approval could come on Thursday when EU leaders meet for a summit in Cyprus.
Cautious Optimism After Months of Delay
EU foreign policy chief Kaja Kallas was reluctant to speculate on the outcome, telling reporters on Tuesday, "We expect an agreement in 24 hours, so I don't want to jinx it." The 27-nation EU had originally intended to use Russian assets frozen in Europe as collateral for the loan, but that option was blocked by Belgium, where the bulk of the frozen assets are held. In December, the Czech Republic, Hungary, and Slovakia agreed not to stop their EU partners from borrowing the money on international markets as long as the three countries did not have to take part in the scheme. However, Orbán later reneged on that deal over the pipeline dispute and as campaigning heated up ahead of the election he lost in a landslide.
Ukraine's Position
In a Tuesday evening address, Zelenskyy stated that "there can be no grounds for blocking" the loans anymore. "The EU asked Ukraine to repair the Druzhba oil pipeline, which had been destroyed by Russia. We have repaired it." Foreign Minister Andrii Sybiha told reporters that Ukraine has done its part, saying, "We have completed everything — there is a date (set), and the infrastructure has been repaired."
New Sanctions on Russia
The EU has also been trying since February to push through a new raft of sanctions against Russia, which Hungary and Slovakia have been blocking. The measures could take longer than the loan to approve. Slovak Foreign Minister Juraj Blanár said Tuesday that his country would only agree once "Russian oil arrives in Slovakia through the Druzhba pipeline. I can state that we do not have such information yet." Economy Minister Denisa Saková said Slovakia expects oil supplies to resume early on Thursday, according to information from Ukrtransnaft, a company that operates the pipeline on Ukrainian territory, indicating that oil began entering the Druzhba pipeline again on Wednesday.
