EU’s €90 Billion Ukraine Loan Revived After Orbán Defeat, Oil Resumes

A €90 billion EU loan for Ukraine, previously blocked by Hungary under Viktor Orbán, is set to be revived. This follows Orbán’s defeat in the April 12 election and the resumption of Russian oil deliveries to Hungary via Ukraine.

EU leaders decided last December to jointly borrow this money to fund Ukraine’s defense against Russia for 2026 and 2027. The scheme uses frozen Russian funds as a potential backstop. Hungary, Slovakia, and the Czech Republic, seen as closer to Moscow, secured exemptions from participating in the joint borrowing.

The EU will provide interest-free loans for 2026-2027, backed by the EU budget headroom. Ukraine is not expected to repay the loan from its own funds; repayment is contingent on Russia paying war reparations using its approximately €210 billion in frozen central bank assets in the EU. This approach avoids confiscating funds, which was deemed legally risky.

The €90 billion will cover two-thirds of Ukraine’s estimated €135 billion needs for the next two years, with €45 billion allocated for 2026 and €45 billion for 2027. Annually, €28 billion will go to military needs and €17 billion to general budget needs. Other developed countries are expected to provide the remaining funding. The loan was initially opposed by Orbán, but prospects brightened after his election loss and incoming Prime Minister Peter Magyar stated he would not oppose the disbursements. The Druzhba pipeline, which had caused a previous blockage, has also been repaired.