The Kremlin continues to fund its military aggression against Ukraine through energy exports. While Europe has significantly reduced its overall reliance on Russian oil and gas, many Central and Eastern European countries remain excessively reliant on these imports. The result has been a weaker impact of the EU sanctions on the fundamentals of Russia’s economic and political strength.
These are some of the key findings from a closed-door expert discussion on Mission Possible: Phasing Out Russian Oil and Gas in Central Europe, held on May 22 in Budapest, Hungary. The event brought together key energy experts and business leaders to explore practical strategies for ending the dependence on Russian fossil fuels in Central Europe.
The roundtable featured a presentation by Isaac Levi, Lead, Europe-Russia Policy & Energy Analysis Team, Centre for Research on Energy and Clean Air (CREA), and Tsvetomir Nikolov, Analyst, Energy and Climate Program, Center for the Study of Democracy (CSD), who introduced the key results of a recent comprehensive, joint assessment of CSD and CREA, titled The Last Mile: Phasing Out Russian Oil and Gas in Central Europe.
The analysis highlights how, despite sanctions, Russian oil and gas revenues remain resilient, making up roughly one-third of the Kremlin’s export income. Exemptions to the EU’s Russian oil ban, granted to Hungary, Slovakia, and Czechia for crude pipeline imports via the Druzhba pipeline, have undermined the strength of the embargo. Moreover, the refining loophole allows countries like India and Türkiye to increase imports of Russian crude, refine it, and export petroleum products back to the EU and U.S. These mechanisms have enabled Russia to generate nearly €10 billion in additional tax revenue in 2024.
The report also maps an increasing trend of surging Russian LNG and pipeline gas imports across Europe. Russia-linked gas supply to the EU rose by 25 to 30 percent year-on-year in 2024. Central and Eastern Europe, in particular, has seen an acceleration of gas flows through the TurkStream pipeline, allowing Russia to bypass Ukraine and maintain its presence in the European energy market. This weakens the EU’s Roadmap for phasing out Russian oil and gas by 2027 as it reduces demand for alternative sources such as U.S. LNG.
During the discussion, participants agreed on the urgent need to close loopholes in the sanctions regime, design a detailed plan of how to replace Russian imports and expose the oligarchic networks that have benefitted from the Russian energy capture. The speakers emphasized that Europe must not backslide into Russian gas dependence, especially as ample alternative LNG supply is available.
The conversation concluded with a shared recognition that there are no technical or economic obstacles before the elimination of Russian oil and gas but that there is a need for careful planning and political will on regional level to mobilize the necessary efforts of attracting alternative deliveries.
