20th February 2015

Hungary shows early signs of opposition against Energy Union

Days before the long-awaited Commission Communication on the Energy Union project, Hungarian Prime Minister Viktor Orbán indicated that his country might have serious problems with this EU initiative. The EU wants to integrate the energy market and several measures to achieve this are being designed. One of them may be obligatory assessment by the EC of all energy deals with third countries. Orbán said measures such as this one hinder national sovereignty and are unacceptable.

It is perhaps without surprise, that two days before these words were spoken, the Russian President Vladimir Putin had visited Budapest to debate energy. Orbán and Putin discussed long-term gas supplies and discounts, both of which were obviously agreed on. Russia pushes for energy agreements on a country-to-country basis, while EU would like more coordination and possibly also common purchases, as this would strengthen the bargaining position of the 28-member-strong bloc.

During his visit to Budapest, Putin also stated that the South Stream project, proclaimed dead weeks ago by Putin himself, was in fact not dead at all. Putin initially informed that Russia no longer considers South Stream and instead came with the idea of Turkish Stream. Turkish Stream would also bypass Ukraine, but would not transit Bulgaria to go further West, as the South Stream, but would instead end in Turkey. From there, the EU would be responsible for finding a way of getting hold of the gas, Putin had said earlier. Commission Vice-President Šefčovič commented on this as being impossible. At the same time, though, the EC turned to Russia with questions over the South Stream progress. In fact, the South Stream project was never formally cancelled. It is possible, that Russia may reconsider. It seems that it has the backing of Hungary in energy issues.

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Members of the American Chamber of Commerce in the Czech Republic