Viktor Orbán’s trip to Moscow serves as a dialogue and sustainable overhead cost reduction
The Hungarian Prime Minister meets with Vladimir Putin for the twelfth time. As a member of Western integration organizations, Hungary calls for the peaceful resolution of conflicts, which requires mutual respect and dialogue. Viktor Orbán’s trip to Moscow also serves the sustainability of the results of the overhead cost reduction due to the planned energy agreements.
The Hungarian left has demanded the head of government to cancel the trip, which jeopardises the sustainability of the overhead cost reduction and the continuation of the economic cooperation that started in 2021. As the preliminary announcements suggest, Hungary would increase the amount of gas already contracted in 2021 by one billion cubic metres per year.
The demand of the left jeopardising the energy supply of the Hungarian population and economy is not surprising, as their candidate for prime minister has repeatedly condemned the reduction of overhead costs, did not support social considerations in petrol prices and expects a reduction in domestic energy consumption from world market energy prices, which the population can support by reducing its own consumption. According to Péter Márki-Zay, “less water, electricity and gas should be used”. He says people are “encouraged to save energy through prices”.
In contrast, the civilian government has signed a 10+5-year long-term gas supply contract with Russia, for which the Balkan Stream gas pipeline, which was built jointly with the countries of the Western Balkans and Turkey, will provide a transport route. Russian gas is also supplemented on this route by Azerbaijani and Turkmen natural gas.
The left’s position is also inconsistent because one day it considers the retail price fixed by the overhead cost reduction to be higher than that of the world market, while the other day it attacks the government’s measures which allow them to conclude long-term supply contracts to make the overhead cost reduction sustainable.
Based on the above-mentioned facts, it can be stated that this demand of the left is against the interests of the Hungarian population and, yet again, reflects the position of Brussels.
Actually, the European Commission is in favour of short-term contracts, which it expects to reduce energy prices, but does not take into account the significant increase in energy demand due to the ideology-driven climate policy. While energy prices are breaking record in Western Europe, the overhead cost reduction makes Hungarian families’ expenses predictable.
Századvég collected and analysed the most common arguments made in public about Viktor Orbán’s visit to Moscow:
“No trip should be made to Moscow in such a tense situation…”
Viktor Orbán meets with Vladimir Putin for the twelfth time. This is not the first time the two leaders have met in a tense international situation. There was much more intense fighting in Eastern Ukraine at the time of their meeting in February 2015. As decision-making that requires unanimity is common in the most important foreign and security policy issues in Western integration organizations, the head of government of Hungary, a member of the EU and NATO, has the right and obligation to be informed first-hand to make wise and well-founded decisions. To this end, as many views of the parties concerned as possible should be known and all opportunities for a peaceful settlement should be seized. Prior to his current meeting with the Russian head of state, Viktor Orbán held talks with the President of France that holds the rotating EU presidency, and the Secretary General of NATO. It is important to emphasize that, as a member of Western integration organizations, Hungary has always adhered to the official decisions of these organizations, which it also voted for.
“The trip to Moscow is a gesture to Putin…”
Bilateral meetings of heads of state and government are well-established events in diplomacy, providing a good opportunity to resolve open issues and build mutual trust. That is why US President Joe Biden met with Vladimir Putin in the year of his inauguration. Such summits are being prepared by foreign ministers, and this is what we have seen nowadays on the part of American, German, British and French diplomacy. That is why Boris Johnson will travel to Moscow soon.
Viktor Orbán’s trip takes place in the framework of regular annual meetings, this time the Hungarian Prime Minister travels to the Russian capital on the basis of reciprocity, so it cannot be considered a gesture.
“Leaders of other countries do not negotiate with Putin…”
We have already mentioned above that after Joe Biden, Boris Johnson is also going to meet with the Russian Head of State soon. Several Western leaders, most recently Emmanuel Macron, called Putin, who invited him to a bilateral meeting in August 2019 in connection with the G7 summit in France. We should also recall that the incumbent German Chancellor, Olaf Scholz, was lobbying in Washington as federal finance minister that, in return for increasing German LNG purchases, the US would not sanction the Nord Stream 2 pipeline, which the German Chancellor has recently seen as a “project of private investors”.
Following Germany, Austria and France have recently taken the opportunity that their former heads of government or senior politicians take up leadership positions in (partly) state-owned Russian energy companies, thus ensuring informal dialogue. Former Social Democrat Chancellor Gerhard Schröder has become a member of the management of Rosneft and Nord Stream 2, while former French Prime Minister Francois Fillon has become a member of the management of Sibur gas processing company. Former Austrian Foreign Minister Karin Kneissl strengthens the Board of Directors of Rosneft.
“Dependence on Russian energy should be reduced!”
It should be mentioned here that while the US leadership is demanding the EU to end Russian energy imports, the US is importing more and more oil from Russia, which in 2021 became the second largest oil supplier to the United States after Canada. Just as it wanted to sell Alaskan gas to Western Europe in the 1980s, the US is now trying to sell LNG, which is obtained and liquefied by using polluting fracturing technology and transported across the Atlantic in an energy-intensive way.
The gas pipelines connecting Hungary with the neighbouring countries are now suitable for the so-called reverse transportation as well, which has diversified the gas supply of our country. The Hungarian government has also reserved capacity at the LNG terminal on the island of Krk, Croatia, and provides gas transit for Ukraine coming therefrom. Azerbaijani and Turkmen gas also arrives via the Balkan Stream gas pipeline opened in October 2021, which may be supplemented in the near future by gas from new fields discovered in the Eastern Mediterranean basin. The Hungarian government has always taken the view that both transport routes and suppliers need to be diversified.
“Viktor Orbán will take Hungary out of the EU and NATO”
The Europe Project research conducted by Századvég also supports the trend that citizens of the states in our region have more trust in Western integration organizations than their Western European contemporaries. The citizens of the Visegrád countries, as well as those living in the countries of the former socialist bloc, overwhelmingly support the membership of their countries in these organizations. This is also true of Hungary, so questioning the country’s western integration and having it suspected is counterproductive on the part of the opposition.
All in all,
Viktor Orbán’s trip to Moscow serves the strengthening of bilateral Russian-Hungarian economic relations, the focus of which is on energy cooperation. By increasing the amount of gas stipulated in the long-term gas supply contract and starting the construction of Paks 2 as soon as possible, the overhead cost reduction will become sustainable, and the predictable energy supply of the Hungarian economy will be further secured.