South Stream Pipeline: Hungary backs Putin's plans to shift gas flows through Turkey instead of Ukraine.

Hungary Just Signed on to Russia’s Bid to Redraw Europe’s Gas Map

Hungary Just Signed on to Russia’s Bid to Redraw Europe’s Gas Map

Business Insider
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Feb. 18 2015 2:00 PM

Hungary Just Signed on to Russia’s Bid to Redraw Europe’s Gas Map

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Hungary’s decision to bolster the pipeline's re-route to Turkey is the latestwin for Putinnear Ukraine's borders and a blow to a unified European response to Russian aggression.

Photo by Andrej Isakovic/AFP/Getty Images

This post originally appeared in Business Insider.

Last month, Russia announced that it would shift all its flows of natural gas to Europe via Turkey, instead of Ukraine, in an effort to counter its decreasing influence over the European gas market.

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"Our European partners have been informed of this and now their task is to create the necessary gas transport infrastructure from the Greek and Turkish border," Alexei Miller, head of the Russian state oil giant Gazprom, said in a statement.

And now Hungary, a European Union (and NATO) member, has bolstered Moscow's push to redraw the European gas map.

"It would be a good investment for Hungary if it makes sure that Turkish gas goes through Greece, Macedonia, and Serbia to Hungary," Hungarian Prime Minister Viktor Orbán said after negotiations with Russian President Vladimir Putin in Budapest on Tuesday.

screenshot 2015-02-18 09.18.15

Russia Today via Business Insider

The Moscow Times reports that a deal hasn't been signed and that the price of gas hasn't been disclosed. Nevertheless, Orbán said the agreement had been made in principle, and Putin seemed to agree.

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"If they don't hinder us, then in essence we could realize part of the former South Stream project via Turkey," Putin said, referring to the European Commission.

The move makes economic sense to Budapest because Russia is Hungary's biggest trading partner outside the EU and supplies most of its gas. Politically, it's the latest win for Putin near Ukraine's borders and a blow to a unified European response to Russian aggression.

"We are convinced that locking Russia out of Europe is not rational," Orbán said. "Whoever thinks that Europe can be competitive, that the European economy can be competitive without economic cooperation with Russia, whoever thinks that energy security can exist in Europe without the energy that comes from Russia, is chasing ghosts."

Furthermore, the countries prospectively involved in the pipeline plan have increasingly cozy relationships with Putin. (The canceled South Stream pipeline had been slated to pass through both Serbia and Macedonia, which are not in the EU.)

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Last February, Macedonian President Gjorge Ivanov told Russian media "the partnership with the Russian Federation is crucial for us" because the South Stream pipeline was "expected to provide the country's energy stability in the coming decades."

"The only thing I love more than Russia is Serbia," Serbian President Tomislav Nikolic said on a visit to Moscow in December. 

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Serbian President Tomislav Nikolic with Putin during a military parade in October in Belgrade to mark 70 years since the city's liberation by the Red Army.

REUTERS/Vasily Maximov

And geopolitical expert Ian Bremmer recently noted that the signals from the new government in Greece, including comments by Greek Prime Minister Alexis Tsipras regarding sanctions over Ukraine, "as well as his meeting with the Russian ambassador to Greece within hours of taking office—demonstrate that he is willing to engage differently with Moscow."

Politics in Europe are the top global risk for 2015, and Putin's emerging gas plan is making the situation even more difficult for EU leaders.

Elena Holodny contributed to this report