EU approves €90bn loan for Ukraine as pipeline is turned on ending deadlock

Ukraine says it has reopened the Druzhba pipeline, after months of stalemate over stalled oil supplies to neighbouring Hungary. EU approves €90bn loan for Ukraine as pipeline is turned on ending deadlock Copyright current_year BBC. All rights reserved. The BBC is not responsible for the content of external sites. Read about our approach to external linking. Copyright current_year BBC. All rights reserved. The BBC is not responsible for the content of external sites. Read about our approach to external linking. Oil supplies through the Druzhba pipeline into Hungary and Slovakia were halted at the end of January (file pic) The Druzhba oil pipeline between Hungary and Russia is seen at the Hungarian MOL Group's Danube Refinery in Szazhalombatta, Hungary, May 18, 2022 Ukraine says it has resumed pumping Russian oil through a pipeline into Hungary and Slovakia, bringing to an end months of deadlock over a €90bn (£78bn) loan seen as vital European Union support for Kyiv. Soon afterwards, EU ambassadors meeting in Cyprus gave preliminary approval to the loan, as well as a 20th package of sanctions on Russia, officials said. EU leaders will sign it off at an informal summit on Thursday. Although the funding was agreed last December, Hungary's Viktor Orbán slapped a veto on the payment in February after Ukraine said damage caused by a Russian attack had brought supplies to a halt. Ukrainian oil and government sources told officials in Hungary and Slovakia that pumping had restarted, hours after the EU ambassadors began discussing the loan. Orbán had demanded the oil start flowing again before the loan could be paid out, and Ukraine confirmed the repairs had been completed on Tuesday. His election defeat last Sunday also cleared the air for the EU, bringing to an end his 16-year era as prime minister. Hungary's next leader, Péter Magyar, has prioritised a reset in Budapest's poor relations with Brussels. "Ukraine really needs this loan and it's also a sign that Russia cannot outlast Ukraine," EU foreign policy chief Kaja Kallas said ahead of the ambassadors' meeting. The EU funding has been described by Ukrainian Deputy Prime Minister Taras Kachka as "a matter of life and death" for Kyiv, and two-thirds of it will be spent on bolstering Ukraine's defence needs while the rest will go on broader financial assistance. Slovak Economy Minister Denisa Sakova said she had been told by energy operator Ukrtransnaft, which looks after the Druzhba pipeline in Ukraine, that pressurising of the pipeline had begun on Wednesday morning and crude oil would start flowing into Slovakia on Thursday, for the first time since 27 January. The volume of pumping was not yet clear, but a Ukrainian government source was quoted as saying that the transit of oil had begun at 12:35 local time (09:35 GMT). Hungarian energy firm Mol said it expected the first supplies by Thursday at the latest. Map showing two strands of a pipeline from Russia into Europe in red. One strand goes through Hungary into Ukraine before connecting to another strand going into Russia. Orbán, who is acting as caretaker leader until early next month, made clear at the weekend that as soon as oil deliveries through the pipeline were restored "we will no longer stand in the way of approving the loan". In the run-up to Hungary's bitterly contested election this month which Orbán lost, he had accused Ukraine of imposing an "oil blockade" on his country and neighbouring Slovakia, claiming that the EU was working with Kyiv against him. Satellite images at the time suggested substantial damage to a major oil tank at Brody in western Ukraine in late January and Kyiv had insisted that repairs would take some time, adding that its engineers had come under Russian attack. Ukraine emergency services DSNS published photos of smoke from the Brody oil hub following a Russian bombardment Thick dark grey smoke billows from the Brody oil hub as firefighters tackle an unseen fire with two hoses from an extended ladder. Meanwhile, Ukraine has also targeted oil facilities inside Russia, including a pumping station in Samara region linked to the Druzhba pipeline this week. Orbán's decision to renege on last December's agreement to provide Ukraine with a €90bn loan had infuriated EU leaders, who had agreed to give Hungary, Slovakia and the Czech Republic an opt-out from the scheme. The Hungarian leader, long seen as the EU's closest partner to Russia's Vladimir Putin, made hostility towards both Ukraine's Volodymyr Zelensky and the EU central to his failed election campaign. Campaign posters across Hungary portrayed Zelensky alongside Magyar with the message: "They are dangerous!" Zelensky said late on Tuesday he had discussed how the loan would be unblocked with European Commission President Ursula von der Leyen and the head of the European Council, António Costa, who represents the 27 member states. "There can be no grounds for blocking it any more," Zelensky said. "The EU asked Ukraine to repair the Druzhba oil pipeline, which had been destroyed by Russia. We have repaired it. We hope the EU will also deliver on the agreed commitments." If the EU loan is finally agreed, it could still take weeks before funding arrives in Kyiv, Ukrainian media report. A large smoke plume rises from oil tanks, there are visible flames in the satellite image and the sea nearby is visible Huge fires at Russian oil facilities following Ukraine strikes, satellite images show Ukraine-Hungary oil pipeline row threatens EU loan Unprecedented ruling finds Hungary's anti-LGBTQ laws in breach of EU values Viktor Orban, Hungary's prime minister, delivers a speech in January. 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