Hungary Requests US Sanctions Exemption for Russian Natural Gas Payments

SEATTLE (Oil Monster): Hungary has requested the United States to provide the country with a sanctions waiver to further continue payments for Russian natural gas imports through Gazprombank, Foreign Minister Peter Szijjarto said on Dec. 4.

The United States introduced new sanctions on Nov. 21, targeting dozens of Russian banks, including Gazprombank, securities registrars, and financial officials.

"Yesterday, we filed our request with the relevant American authorities that calls for Gazprombank being granted an exception from sanctions when it comes to payments for natural gas," Szijjarto said, amid a visit to Washington ahead of President-elect Donald Trump's inauguration.

After the sanction were initially announced, Szijjarto said on Nov. 22 that sanctions marked an "attack on our sovereignty," deeming the implementation as a "threat to energy security."

The U.S. had previously refrained from targeting Gazprombank to allow European countries to continue paying for Russian gas supplies, as the bank is the primary channel for energy-related payments. Despite the past restraint, the U.S. Treasury Department said that the most recent sanctions "will make it harder for the Kremlin to evade U.S. sanctions and fund and equip its military."

The Financial Times noted in its reporting that Russia used Gazprombank to purchase military equipment, pay soldiers, and compensate the families of those killed in the war in Ukraine.

The new U.S. sanctions are intended to close one of Russia's few remaining avenues for international banking, barring Gazprombank from conducting transactions in dollars.

Budapest is broadly seen as the most Moscow-friendly country within the EU and NATO, repeatedly obstructing aid to Kyiv and sanctions against Russia. Szijjarto has also repeatedly visited Russia throughout the full-scale war, a step that his European colleagues avoided.

Along with Slovakia and Austria, Hungary remains reliant on Russian gas, paid for through the now-sanctioned Gazprombank. Hungary receives roughly 4.5 billion cubic meters of Russian gas on an annual basis under a 15-year deal signed in 2021.

Hungary's request comes as Turkey has been in talks with the U.S. in it effort to receive its own sanctions waiver for Gazprombank.

On Nov. 26, a source familiar with the plans told Reuters, that Gazprom, Russia’s state-controlled gas company, is planning for a scenario in which no natural gas will flow to Europe through Ukraine after Dec. 31, 2024.

Courtesy: www.kyivindependent.com