The EU's 14th package of sanctions on Russia: what is Hungary's dependence on Russian LNG?

HUNGARY - In Brief 26 Jun 2024 by Istvan Racz

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The following is supposed to be a brief clarification of Hungarian dependence on the imports of Russian LNG. This is not because the EU's 14th sanction package, approved just a few days ago, would prohibit or block in any way the imports of LNG from Russia, because it obviously does not do that. But the prohibition of the sales of LNG technology to Russia is based on the assumption that that measure would reduce Russia's ability to produce and export LNG in the end. (This may or may not be a correct assumption, but anyway...) So, in 2023, the EU bought some 18 bcm of LNG from Russia, 6% of its annual gas consumption. The EU's goal is to reduce this to zero by 2027. As for Hungary, with the currently most likely 8.1 bcm of annual gas consumption in 2024 (more detail on this was disclosed in our June monthly report), 1.8 bpm of domestic gas output, and some 1.5 bcm of non-Russian LNG imports from Croatia, the remaining annual net requirement for gas imports would be 4.8 bcm. Hungary has a long-term contract with Russia on annual shipments of 4.5 bcm of gas, of which 3.5 bcm is supposed to arrive through the Turk Stream pipeline. The remaining 1 bcm should arrive essentially from the westernly direction, and given the current situation, in which Russian pipeline gas shipments from any direction other than Turk Stream are just now ending completely, this is supposed to be LNG (more accurately pipeline shipments covered by the arrival of Russian LNG to some European ports). The remaining 0.3 bcm could be anything, whatever kind of gas is available for purchase at any given time. Our conclusion is that Hungary's maximum dependence on Russian LNG shipments must be a net 1.3 b...