Hungarian Prime Minister Peter Magyar rejects the Naftogaz-MOL agreement on oil storage facilities intended for Ukraine

Hungarian Prime Minister Peter Magyar rejected on Monday an agreement announced by Ukrainian company Naftogaz and energy group MOL to build oil storage facilities in Hungary to protect Ukraine’s reserves from Russian attacks. Magyar said the project would not go ahead as long as his Tisza party led the government in Budapest.

The announcement rejecting the project came after Naftogaz said it had signed a memorandum with MOL during the summit of the Carpathian Integration Initiative, hosted in Ukraine on Friday by President Volodymyr Zelenskyy. According to the Ukrainian company, the facilities were to be built near Hungary’s border with Ukraine to facilitate the subsequent transport of oil to Ukrainian territory.

Naftogaz CEO Sergii Fedorenko justified the project by citing Russian attacks on Ukraine’s oil infrastructure. He argued that diversifying supply routes and creating storage capacity outside areas targeted by attacks were necessary for the country’s energy security.

Peter Magyar said the agreement had been signed without the participation of the Hungarian government. The prime minister said he had spoken with MOL CEO Zsolt Hernádi, who allegedly told him that negotiations had begun under the former government led by Viktor Orban, with the involvement of the United States. Hungary and Ukraine have tense relations, partly because of the situation of the Hungarian minority in Transcarpathia.