Hungary’s quest to unblock frozen EU funds seized by thorny issues like Russian fuel reliance and Ukraine

A meeting between Hungary and the European Commission on Friday (29 May) has been described by the new prime minster Péter Magyar as its “most important talks of recent years.”

Magyar is hoping to unblock over €10.4bn in frozen EU post-pandemic Covid funds following a planned meeting on Friday with European Commission president Ursula von der Leyen.

The commission has declined to offer any detailed comments given the sensitivity of the issue, but has confirmed that the phasing out of Russian energy will also likely be broached.

“I will not anticipate, prejudge, include, or exclude any particular topic,” said Paula Pinho, chief spokesperson for the commission, when pressed.

Magyar’s government wants to phase out its Russian energy reliance by 2035, whereas the EU has set an overall deadline for next year under its so-called RepowerEU roadmap.

The dependency on Russian energy is a legacy of his pro-Kremlin predecessor Viktor Orbán, who had led a nationalist government for some 16 years before being ousted in last month’s elections.

The Center for the Study of Democracy, a Sofia-based think tank, says Hungary deepened its reliance on Russian oil since receiving an EU derogation in 2022, with Russian crude accounting for over 90 percent of imports by 2025.

It also found that domestic fuel prices in Hungary were on average 18 percent higher than in the neighbouring Czech Republic in 2025, even though Budapest still buys cheaper Russian oil.

Magyar has since vowed to reverse engineer Orbán’s policies and hold his Fidesz party accountable for widespread alleged corruption in the hopes of also normalising relations with the EU and unblocking a further €17bn over rule of law issues.

But Hungary also risks losing access to €10.4bn in Covid-era funds if it fails to meet a series of milestones by 31 August, creating a sense of urgency for Magyar’s Tisza party, which enjoys a constitutional majority.

Of that sum, €6.5bn are grants and the remaining €3.9bn are cheap loans.

Unlocking these funds will require Budapest to present the commission with a plan that would satisfy 27 specific “super milestones” focused on judicial independence, anti-corruption measures and financial transparency.

Speaking to reporters in Brussels, Pinho said Magyar will also be attending upcoming meetings dealing with Ukraine’s enlargement.

The country’s fate for eventual EU membership has so far been stalled by Hungary’s veto, given outstanding issues over a Hungarian minority in Ukraine’s western region of Transcarpathia.

Some 150,000 ethnic Hungarians live in the area. Magyar had last week announced plans to meet with Ukraine’s president Zelensky in June should the thorny issue over their rights be sorted, including language.