EU Approves €90 Billion Loan for Ukraine after Pipeline Standstill
European Union ambassadors are meeting in Cyprus with expectations high that a €90bn (£78bn) EU loan seen as vital support for Ukraine can finally be paid out after months of deadlock.
The funding was agreed last December, but Hungary's Viktor Orbán slapped a veto on the payment in February in a row over supplies of Russian oil that came to a halt through a pipeline in Ukraine.
Ukraine reported that an oil hub on the Druzhba pipeline was damaged in Russian strikes, yet Orbán insisted on the restoration of oil flow before any loan could be released.
However, the EU believes the deadlock is about to end as Ukraine has confirmed the pipeline has been repaired.
Orbán's recent election defeat has also cleared the previous constraints on the EU's decision-making, with Hungary's next leader, Péter Magyar, looking to improve relations with Brussels.
We expect positive decisions regarding the €90bn loan, EU foreign policy chief Kaja Kallas stated, emphasizing Ukraine's urgent need for support.
Ukrainian Deputy Prime Minister Taras Kachka called the loan a matter of life and death, anticipating that two-thirds of the fund will bolster defense needs while the remainder caters to broader financial assistance.
On Wednesday, Hungarian energy firm Mol announced that Russian oil deliveries would resume through the Druzhba pipeline for both Hungary and Slovakia after a lengthy absence since January.
Orbán confirmed that with restored oil supplies, Hungary would no longer obstruct the loan approval process.
In the lead-up to Hungary's contentious election, Orbán accused Ukraine of orchestrating an oil blockade against Hungary and Slovakia, yet now insists the pathway for the loan is clear following Ukrainian repairs and improved EU support.
As negotiations progress, Ukrainian President Volodymyr Zelensky has reiterated his discussion with EU leaders on expediting the loan approval and expressed hope for the EU to uphold its commitments.
If approved, the loan could take weeks to materialize in Kyiv, yet the momentum is now in favor of Ukraine's much-needed economic support.
