Hungary’s veto on money for Ukraine is to hijack the spotlight at Thursday’s EU summit in Brussels (19 March), alongside disagreements over Europe’s carbon market, overshadowing what was meant to be a key debate on turning Europe into a truly economic powerhouse.
In draft conclusions, seen by EUobserver, leaders are expected to call for the “swift adoption of the 20th sanctions package” against Russia — which are currently blocked by Hungary and Slovakia over disputes over a damaged oil pipeline.
EU sanctions need to be agreed by unanimity, giving leverage to Budapest and Bratislava to ask for Ukraine to repair a Soviet era oil pipeline carrying Russian oil to these countries, despite a deadline to stop the import of Russian fossil fuels approaching.
On top of that, Hungarian prime minister Viktor Orbán is also blocking the disbursement of €90bn to Ukraine, previously agreed during marathon talks at the EU leaders’ summit last December. Hungary’s vetoes are widely seen as domestic fuel for Orbán’s campaign ahead of the tight 12 April elections, as opinion polls point to a potential end to his 16-year rule.
Back in December, EU leaders decided not to use Russian frozen assets to assist Ukraine, instead agreeing on a €90bn loan — without the involvement of Hungary, Slovakia and the Czech Republic.
But Orbán himself made it clear on Tuesday on X, saying: “No oil deliveries? No money. It’s that simple”.
The deadlock has drawn sharp criticism from other national representatives in lower-level meetings ahead of Thursday’s gathering, where EU member states are expected to urge Orbán to respect the December agreement.
“A decision taken needs to be respected, and commitments need to be respected,” said an EU senior official ahead of the meeting.
“There is no plan B [to the €90bn loan] … this was plan B in December,” an EU senior diplomat pointed out.
The diplomat also said that Orbán’s veto after the December agreement is “unacceptable” and sets a “very dangerous precedent”.
“We have only one plan, and that is that Orban should deliver on his promise,” a second EU senior diplomat said.
But with no sign of Orbán backing down over the past few weeks, some member states are pushing for more bilateral aid to Ukraine, arguing the burden isn’t being shared evenly.
According to data from the Kiel Institute, the UK, Germany, Norway, Sweden, Denmark, and the Netherlands led funding for Ukraine’s defence in 2025.
Czech initiative
In a bid to unblock the much-needed EU aid to Ukraine and new Russian sanctions, the Czech Republic has portrayed itself as a possible bridge builder.
Prague has proposed a joint-inspection mission to the Druzhba oil pipeline, bringing together Czech experts with counterparts from Hungary, Slovakia, and the European Commission.
The move, which was floated earlier this week, is seen as a possible compromise after Hungary and Slovakia appeared opposed to relying solely on commission experts on site.
But no agreement on the form of this mission has been reached yet.
And it is unclear to EU officials in Brussels whether there are already experts in Ukraine.
Earlier this week, EU institutions reached a deal with Kyiv to fix the damaged Russian oil pipeline, in which commission experts were to visit the Druzhba pipe and any repairs would be paid from the EU budget.
The reparation and restart of operations makes little longer-term sense, as a new EU law will ban all imports of Russian fossil fuels by 2027.
But EU institutions still back the narrative put forward by Hungary and Slovakia.
“The import of oil for Hungary and Slovakia is, according to our legal framework, legal, and it is allowed at least until the end of 2027 for reasons of energy security of those two landlocked countries. So it is normal that the institutions of the European Union defend that the pipeline should continue to run,” the EU senior official also said.
Ukrainian president Volodymyr Zelensky, for his part, said in a public letter on Tuesday that the pipeline would take “one and a half months” to fix – running past Orbán’s 12 April election day.
De-escalation calls as oil prices soar
On Iran, EU leaders are expected to call for “de-escalation”, “maximum restraint” and “the respect of freedom of navigation,” as the Strait of Hormuz remains blocked, making energy prices soar across the globe.
But no talks are expected on sending European ships to the Strait of Hormuz, as requested by US president Donald Trump, or extending the mandate of the EU’s Aspides, established in 2024 to protect ships from Yemen’s rebel Houthis.
Earlier this week, talks at ministers’ level showed little appetite for these options.
“That track at the moment has ended,” one diplomat said.
EU leaders will also condemn Iran’s attacks on the region and show support for Cyprus, where a British military base were also hit, by a drone, without serious damage.
Spanish prime minister Pedro Sánchez has emerged as one of the few leaders, hesitantly joined by France, Slovenia, Belgium and others, to call out US and Israeli attacks on Iran as illegal and outside international law.
And he is expected to come to Brussels with his motto “No to War” — a historic slogan against the Iraq invasion in 2003, being framed domestically as both a moral foreign‑policy stance and a potential electoral asset ahead of upcoming elections.
But no mention of the US and Israel attacks on Iran is to be found (or expected) on the EU summit conclusions — the main tangible outcome of Thursday’s meeting.
“There was no consensus to go further,” explained a EU senior diplomat, arguing that there is still wording on the bloc’s commitment to “effective multilateralism” and “the rules-based international order”.
On multilateralism, EU leaders will be joined by UN secretary-general António Guterres, whose mandate ends this year.
Beyond diplomatic efforts and the spillover of the Iran war in the region, with words of concern about Lebanon and Palestine, talks are expected to touch on energy prices (as oil prices are above $100 a barrel), supply chains, migration and internal security.
Fight over carbon markets
EU leaders are also set to press the commission to quickly propose targeted measures to curb rising fossil fuel and electricity prices, while boosting investment in renewables. They will also urge co-legislators to approve a grids package and accelerate affordable electrification.
Discussions on competitiveness could spark debate over the ‘European preference,’ with some countries concerned it might distort competition and weaken the single market.
But the main battleground will be Europe’s carbon market, the EU Emissions Trading System (ETS). Draft conclusions call on the Commission to present a review by July 2026 — leaving open the key question of what changes might follow.
Member states are deeply split.
Countries like Poland and the Czech Republic have strong concerns about the system, while Italy has even called for it to be scrapped. In contrast, Denmark, the Netherlands, Sweden, Finland, Spain, Portugal, Slovenia, and Luxembourg have backed it in a joint non-paper.
On Wednesday, another group of 10 countries — Austria, Croatia, Bulgaria, Romania, the Czech Republic, Greece, Italy, Slovakia, Hungary, and Poland — called for free emissions allowances for industry to continue beyond 2034 and for the ETS review to be brought forward to May.
Meanwhile, the energy crisis has also raised concerns about a potential easing of sanctions on Russia, after Donald Trump authorised a 30‑day waiver allowing countries to purchase Russian oil that was already loaded on tankers and stranded at sea.
“I hear voices suggesting that, in light of the energy crisis or the conflict in the Middle East, perhaps sanctions should be eased and normal energy relations with Russia restored. That is not an option,” said Polish prime minister Donald Tusk on Wednesday, the eve of the summit.