After several weeks of drawn-out negotiations stalled by Hungary, EU leaders on Monday (30 May) agreed to ban seaborne imports of Russian oil by the end of the year but fell short of a full embargo.

Under the compromise agreed by EU leaders, the partial embargo will include oil and petroleum products but will crucially allow a temporary exemption for crude delivered by pipeline.

This would amount to more than 90% of oil imports from Russia being ended of the year, according to EU estimates.

“This immediately covers more than 2/3 of oil imports from Russia, cutting a huge source of financing for its war machine.  Maximum pressure on Russia to end the war,” European Council President Charles Michel said.

Since the start of Russia’s war on Ukraine, the EU has sent a total of €56.5 billion to Russia in return for fossil fuel supplies, with payments for oil reaching almost €30 billion being accounted for in crude oil supplies – money being used to fund Moscow’s invasion.

Nevertheless, the agreement falls short of the initial proposal by the European Commission, which envisioned banning all oil imports.

This was not agreed on due to fierce opposition from several EU countries which heavily rely on supplies of Russian oil via pipelines.

Keeping pipelines out of any Russian oil embargo has been a key demand of Hungary, which feared a ban would put its economy at risk given its reliance on oil delivered by the Druzhba pipeline from Russia.

Budapest continued to oppose the sanction long into Monday, with its prime minister Viktor Orbán telling journalists that solutions had to come before sanctions as he went into a meeting with his fellow EU leaders.

Hungary’s opposition drew much criticism from other EU countries, particularly Poland, the Nordics and the Baltic States.

EU leaders, as expected, did not agree on how long any exemptions of oil supplied via pipeline would last.

Instead, they will task EU diplomats and ministers with finding a solution that would also ensure fair competition between those still getting Russian oil and those being cut off.

Germany and Poland, which could benefit from the pipeline exemption, have committed themselves to a de facto shutdown of the northern Druzhba pipeline by the end of the year, EU diplomats told reporters.

An EU official said the Czech Republic secured an 18-month long exemption from the ban to cover the resale of oil products.

Other measures proposed as part of the sixth sanctions package include the exclusion of the largest Russian bank, Sberbank, from the SWIFT international payment system, banning three further Russian state-owned broadcasters and listing individuals who have committed war crimes in Ukraine.

The final deal on the sixth sanctions package would need to be agreed upon by all 27 member states.

[Edited by Benjamin Fox]