BRUSSELS – After months of debilitating deadlock that left Kyiv waiting for critical support amid its ongoing war with Russia, European Union envoys convened in Brussels this week with a rare sense of cautious optimism that a historic €90 billion ($106 billion) multi-year loan package for Ukraine could finally win final approval as soon as Thursday. The massive funding package is designed to cover Ukraine’s urgent military and core financial needs over the next two years, shoring up an economy shattered by nearly four years of full-scale Russian invasion and helping Kyiv maintain its defensive line against advancing Moscow forces.
The months-long logjam revolved around a single sticking point: Hungary’s veto, which Prime Minister Viktor Orbán – who was ousted in last month’s general election and will step down next month to make way for pro-EU opposition leader Péter Magyar – refused to lift until Russian oil shipments via the Druzhba pipeline through Ukrainian territory resumed. Hungary and neighboring Slovakia both remain dependent on Russian crude to meet their national energy demands, and the two countries had accused Kyiv of dragging its feet on repairing a section of the pipeline damaged in a Russian missile strike earlier this year.
That barrier appears to have been cleared, Ukrainian officials confirmed this week. In a social media statement Tuesday, Ukrainian President Volodymyr Zelenskyy announced that all repair work on the damaged pipeline segment was complete. “The pipeline was damaged by a Russian strike, but it can resume operation now,” Zelenskyy said, adding that there are no longer any justifications for holding up the aid package. Ukrainian Foreign Minister Andrii Sybiha reinforced that position, telling reporters Wednesday that Kyiv has fulfilled all conditions placed on it to unlock the funds: “We have completed everything — there is a date set, and the infrastructure has been repaired.” As of Wednesday, pipeline operator Ukrtransnaft had already resumed pumping crude into the line, and Slovakia’s Economy Minister Denisa Saková projected full shipments would reach the country early Thursday.
Even with repairs complete, however, final approval remains contingent on Orbán’s government following through on its threat to lift the veto once oil flows resume. EU diplomats spent Wednesday gauging whether Budapest would send the formal green light, with Cyprus – which currently holds the EU’s rotating presidency – already preparing to launch a formal written approval procedure once the veto is lifted. Such procedures typically remain open for 24 hours, aligning with the timeline for final approval to come during Thursday’s scheduled EU leader summit in Nicosia.
Given repeated false starts on unlocking the aid over recent months, EU officials are approaching the potential breakthrough with measured caution. EU High Representative for Foreign Affairs Kaja Kallas declined to speculate on a guaranteed outcome when pressed by reporters Tuesday, noting: “We expect an agreement in 24 hours, so I don’t want to jinx it.”
The path to this point has been marked by repeated political wrangling over the structure of the aid package. The EU initially planned to back the loan using frozen Russian sovereign assets held across the bloc as collateral, but that plan was derailed by objections from Belgium, where the vast majority of these frozen assets are stored. A revised framework was struck in December, when Hungary, Slovakia and the Czech Republic agreed to allow the EU to raise the funds on international markets without requiring the three nations to participate in any guarantee obligations. Orbán later backtracked on that agreement amid his re-election campaign, tying the aid to the pipeline dispute and drawing sharp anger from the other 24 EU member states, before ultimately losing his bid for re-election in a landslide on April 12.
Parallel to the aid negotiations, the EU is also working to unblock a new package of economic sanctions against Russia, which have also been held up by Hungary and Slovakia over the same pipeline dispute. Unlike the aid package, however, diplomats indicate the new sanctions could take significantly longer to finalize. Slovakia’s Foreign Minister Juraj Blanár confirmed Tuesday that his country would only support the new sanctions once oil shipments are confirmed to have resumed, noting as of Tuesday that “we do not have such information yet.”