US grants Hungary exemption on Russia sanctions after warm Trump-Orban meeting

WASHINGTON - The United States has granted Hungary a one-year exemption from US sanctions for using Russian oil and gas, a White House official said on Nov 7, after Hungarian Prime Minister Viktor Orban pressed his case for a reprieve during a friendly meeting with President Donald Trump in Washington.

Last month, Mr Trump imposed Ukraine-related sanctions on Russian oil companies Lukoil and Rosneft that carried the threat of further sanctions on entities in countries that buy oil from those firms.

Mr Orban, a long-time Trump ally, met Mr Trump at the White House on Nov 7 for their first bilateral meeting since the Republican returned to power and explained why his country needed to use Russian oil at a time when Mr Trump has been pressing Europe to stop doing so.

Mr Orban said the issue was vital for Hungary, which is a European country, and pledged to lay out “the consequences for the Hungarian people, and for the Hungarian economy, not to get oil and gas from Russia.”

Mr Trump, who has been pushing Europe to avoid using Russian energy in order to put pressure on Moscow to end its war with Ukraine, appeared sympathetic to Mr Orban’s position.

“We’re looking at it, because it’s very different for him to get the oil and gas from other areas,” Mr Trump said.

“As you know, they don’t have... the advantage of having sea. It’s a great country, it’s a big country, but they don’t have sea. They don’t have the ports.”

“But many European countries are buying oil and gas from Russia, and they have been for years,” Mr Trump added.

“And I said, ‘What’s that all about?’”

The White House official noted that, in addition to the sanctions exemption, Hungary had committed to buying US liquefied natural gas with contracts valued at some US$600 million (S$780.6 million).

Hungary has maintained its reliance on Russian energy since the start of the 2022 conflict in Ukraine, prompting criticism from several European Union and Nato allies.

International Monetary Fund figures show Hungary relied on Russia for 74 per cent of its gas and 86 per cent of its oil in 2024, and the Fund warned that an EU-wide cutoff of Russian natural gas alone could force output losses in Hungary exceeding 4 per cent of GDP.

The two men also discussed Russia’s war with Ukraine.

Mr Trump said in October that he would meet Russian President Vladimir Putin in the Hungarian capital, but the meeting was put on hold after

Russia rejected a ceasefire.

Mr Trump on Nov 7 said Russia simply did not want to stop fighting.

“The basic dispute is they just don’t want to stop yet. And I think they will,” he said.

The president asked Mr Orban if he thought Ukraine could win the war. A “miracle can happen,” Mr Orban responded.

Economic cooperation

Greater economic cooperation between the US and Hungary was also on the agenda.

Mr Orban predicted a “golden age” between the two nations and made a point of criticising President Joe Biden’s administration, a sure way to garner favor with Mr Trump, who continues to use Mr Biden as a frequent foil.

The Hungarian leader, who faces an election in 2026, has cultivated a strong personal rapport with Mr Trump over the years, including on their shared hard-line immigration policies.

Mr Trump on Nov 7 gave Mr Orban his support for the election.

“He has not made a mistake on immigration. So he’s respected by everybody, he’s liked by some... I like and respect him, I’m a double,” Mr Trump said. “And that’s the way Hungary is being led. They’re being led properly, and that’s why he’s going to be very successful in his upcoming election.”

The EU’s top court ruled last year that Hungary must pay a €200 million (S$301 million) fine for not implementing changes to its policy of handling migrants and asylum seekers at its border.

It must also pay a daily fine of €1 million until it fully implements the measures.

Mr Orban referenced the fine during his meeting with Mr Trump but said Hungary would handle its intra-EU disputes on its own.

A tangible sign of Hungary’s improved ties with the US under the Trump administration came last month when the US fully restored Hungary’s status in its visa waiver program.

Hungary has pushed back against plans by the European Commission to phase out the EU’s imports of all Russian gas and LNG by the end of 2027, deepening a rift with Brussels over relations with Moscow.

Ratings agency S&P noted that Hungary has one of the most energy-intensive economies in Europe – and that its domestic refineries are built to process Russian Urals crude oil.

While it said gas supplies from Azerbaijan and Qatar could help replace Russian supply, it warned that Hungary’s fiscal and external accounts remain vulnerable to an energy shock. REUTERS