In a speech last week, Prime Minister Orbán declared that “the attempts to weaken Russia have not succeeded. By contrast, it is Europe that could be brought to its knees by brutal inflation and energy shortages resulting from sanctions.” Because of the war and the sanctions, there is the fear that there will not be enough energy in Europe. The issue is creating tension across the whole of Europe, threatening businesses, public institutions, and factories alike.
While there are around 11,000 sanctions currently in force against Russia, this didn’t stop Russia’s key energy companies, Gazprom and the like, from reaching record-breaking profits since the war in Ukraine began. Europe’s people and businesses, however, have to endure a larger-than-ever burden caused by rapidly increasing energy prices.
And it’s not just us, Hungarians, and the states of Central Europe that find it difficult to cope with the extra burden. In a statement last week, the Federation of German Industries, for example, started to ring the alarm over the fact that, should energy prices continue to skyrocket at their present pace, they could very well pose a serious threat to the foundations of industry in wealthy Germany.
According to Prime Minister Orbán, alongside a growing list of European leaders, while Brussels told us in early March that we would be able to stop the war through sanctions, now, more than six months later, we see that the war is still going on, and it looks as though it will be with us in the long run.
In the meantime, as we are entering the second half of September and slowly getting closer to turning on the heat across Europe, we must realize, and I know it’s a cliché, that winter is coming. And for the people of many countries in Europe, unlike Hungary where 38 percent of natural gas reservoirs are already filled with enough resources to power the Hungarian economy and keep Hungarian families warm, this winter could be one of the toughest to date.
So, what’s Brussels doing to combat soaring energy prices?
They are proposing to impose a price cap on Russian natural gas imports. What a bright idea! Surely that will bring Russia to its knees…
Adopting the price cap would be just absurd. According to Foreign Minister Péter Szijjártó, who spoke about the issue at length in a video statement published following the meeting of EU energy ministers in Brussels last week, banning Russian gas from EU markets (because that’s what the price cap would mean in practice) would limit supply and therefore further increase gas prices.
“The proposal disguised as a price cap is essentially a political sanction on Russia,” Minister Szijjártó said in the statement, adding that Brussels is disguising it as a trade measure to be able to pass it with a qualified majority instead of a unanimous vote.
In a statement yesterday, Tamás Menczer, Hungary’s state secretary for the development of bilateral relations, also weighed in on the subject. According to him, the price of Russian gas could be capped only if there were an abundance of natural gas in Europe and the continent would be in a position to “dictate the terms.” But the EU is in no such position. On the contrary, the situation is getting worse by the day, and the price cap would result in even less gas that is even more expensive for Europe.
It is high time for Brussels to rethink the measures it is using, as the sanctions have clearly proved ineffective in bringing the war in Ukraine to an end. Making matters worse, they are not simply ineffective but have also backfired, as they led to extra financial burdens on European families. If we don’t change course quickly, the sanctions will continue to exert their negative effects.
And we must not let that happen.