DEMOCRACY DIGEST: OIL ON TROUBLED WATERS

The EU’s proposed oil embargo on Russia causes more rifts within the V4.

The European Commission’s latest planned sanctions to punish Russia has highlighted once again how the war in Ukraine is exacerbating differences between the Visegrad Four group of countries.

Poland has been long calling for a ban on all imports of fossil fuels from Russia, so is throwing its weight behind the plan by the Commission to phase out imports of Russian crude oil within six months and refined products by the end of the year.

In early March, Polish Prime Minister Mateusz Morawiecki condemned Russian energy imports, saying it was not only gas “but also the blood of innocent people” that was pouring through Russian pipelines to the West.

In late April, Gazprom cut off gas supplies to Poland, most likely in retaliation for Warsaw’s strong anti-Russian line, including imposing sanctions on the Russian energy company itself. Poland shrugged off the move, arguing it would manage fine without Russian supplies, especially given it had already been making plans to become independent of Russian gas by the end of 2022 anyway.

Faced with the prospect of an imports ban on Russian oil, Poland’s majority state-owned oil company PKN Orlen said it could replace Russia as the main oil supplier for the entire Central and Eastern European region. The company declared it had not made spot purchases of oil from Russia anyway since the war started and it was intensively testing alternatives.

However, Hungary and, less typically, Slovakia, are against the latest sanctions plan by the Commission, which has proposed an exemption to give the two countries an extra year to implement the ban.

That may still not be enough for Hungary. “In this form, the embargo on Russian oil is not acceptable for Hungary, because it would ruin our energy security,” Hungarian Minister of Foreign Affairs and Trade Peter Szijjarto said in a Facebook post.

He added it is not a question of political will, or intention, but quite simply “a physical, geographical and infrastructural reality.”

The Hungarian government has long been critical of any EU sanctions targeting the Russian energy sector. It had reckoned that as long as Europe’s economic powerhouse, Germany, opposed an embargo on Russian oil and gas, its close energy relations with Moscow would prevail. But when the German government embarked on a new course and threw its backing behind the EU’s sixth sanctions package, which includes that phaseout of Russian oil by the end of the year, Hungary has found itself in a bind.

Hungary receives 60 per cent of its oil from Russia, piped through the Druzhba (Friendship) pipeline. As a landlocked country, it does not have access to alternative maritime transport possibilities, e.g. tankers. Hungary’s only oil refinery also depends on Russian oil, processing a heavy crude, and it would take years and millions of dollars to convert it to the lighter type of oil, experts say.

Zoltan Kovacs, state secretary for international communication, categorically ruled out in an interview with BBC’s HARDtalk that Hungary would accept the sanctions. “The proposal is against Hungarian interests, it is not feasible on the ground, and would completely ruin the Hungarian economy,” Kovacs claimed.

But experts wonder how inflexible Hungary’s stance really is. Some speculate it is more about horse-trading, in which Hungary puts a price tag on its support and, ultimately, concedes. Hungary’s position right now is that even if the phaseout deadline is extended to 2023, “the Hungarian government won’t accept these measures,” said Foreign Minister Szijjarto. And the only scenario under which Hungary would endorse the sixth sanction package is if oil transported through pipelines is excluded from the sanctions, he said. Yet that would undermine the whole oil sanctions regime.

In the meantime, the independent news site Telex reported that in the background the Hungarian administration is busy working on a strategy to reduce Hungary’s dependence on Russian fossil fuels and find alternative supplies, which would include more LNG shipments, pipelines to Italy and to the north, and a modernisation of the electricity sector.

However, such investments would be conditional on getting financing from the EU’s 750-billion-euro coronavirus recovery fund, Hungary’s slice of which (7.2 billion euros in grants and 9 billion euros in loans) is being withheld due to the lack of anti-corruption guarantees.

Experts admit the Fidesz-led government has manoeuvred itself into a difficult situation. Firstly, it has made it a flagship policy to offer the electorate super-low utility costs, with electricity and heat costs in Hungary the lowest in the EU. These generous state subsidies to households do little to stimulate energy efficiency and energy savings. Secondly, it has pursued a strategy to lure energy-intensive investments to Hungary, from the German-based automotive industry to South Korean-dominated battery factories, on the basis of low energy and labour costs. The loss of cheap Russian energy supplies could spell the end for both the government’s signature low utility cost politics and its entire economic strategy.

Theoretically, Hungary could veto the latest EU sanctions package on its own, but Hungary spies an opportunity to build a coalition with Slovakia, Greece, Malta and Cyprus, though it is unclear whether these countries want to get into bed with an Orban government that is growing increasingly isolated for its ambivalence over Russia’s invasion and mass murder in Ukraine.

While more of an EU team player than Hungary, Slovakia too has refused to back the new sanctions targeting Russia’s energy industry. It’s not hard to see why: Bratislava imports roughly 87 per cent of its gas and two-thirds of its oil from Russia, Euractiv informed. This would make the country one of the most vulnerable in the entire EU if Russian imports were to suddenly stop, according to Moody’s, a rating agency.

Slovakia’s only refinery, Slovnaft, would be unable to switch from Russian oil to another type of oil overnight and the required change in technology could take several years, Economy Minister Richard Sulik told reporters, as quoted by AP. “So, we will insist on the exemption, for sure,” Sulik added. Slovnaft representatives previously said that the oil producer could source oil from the south through the Adria pipeline, but a nationwide switch to alternative supplies remains a pipedream for now.

As many as 62 per cent of Slovaks disagree with cutting off Russian gas and oil if it resulted in higher energy prices, according to a recent poll. As of early May, Slovakia’s gas tanks were filled to 22 per cent of their capacity, holding supplies that should last until at least autumn, the Slovak Spectator wrote. Yet the country could be completely cut off from its gas supply in late May when Russian gas giant Gazprom is set to receive payment for the next invoice round. If the fees are not paid in rubles, the gas flow could be halted at once, Russian officials warned.

The Czech Republic is one of Ukraine’s staunchest supporters, and has called for the “toughest sanctions” possible to be levied against Russia. But after seeing Hungary and Slovakia secure exemptions this week on the proposed oil embargo, Prague is seeking its own concessions.

The Czech government is ready to support the embargo, officials said on Wednesday, if it gets an exemption of up to three years in order to build alternative supply routes.

“We are ready to support this decision [on sanctions including oil], given the Czech Republic will have some postponement until capacity is increased in oil pipelines which can deliver oil to the Czech Republic,” Prime Minister Petr Fiala said. “We are trying to get that postponement for two, maybe three years.”

Defence Minister Jana Cernochova, who in March rued that “cheap Russian oil is more important to Hungarian politicians than Ukrainian blood,” has not commented.

Currently, Czechia receives nearly 70 per cent of the 200,000 barrels of crude it consumes daily from Russia. The country produces 1,500 barrels itself. Its main alternative import route is via the TAL pipeline running from Italy to Germany. Prague purchased a stake in TAL in 2012 to boost its energy security.

However, Czechia has done little to expand its alternatives in the meantime. Instead, it has spent recent years building new capacity to link to Russian energy supplies, such as expanding its gas network in order to operate as a distribution hub for supplies arriving through the now-frozen Nord Stream 2 pipeline. Prague is now waiting for the approval of the Bavarian authorities to increase the capacity of its link to TAL.

Press freedom a mixed bag
Poland fell two spots to its lowest position, 66th, in the World Press Freedom Index 2022 edition compiled by Reporters without Borders (RSF), released this week.

“While Poland has a diverse media landscape, public awareness of press freedom remains weak,” RSF concluded. “After turning the public media into instruments of propaganda, the government has multiplied its attempts to change the editorial line of private media and control information on sensitive subjects.

RSF highlighted the ban on reporting from the Polish-Belarus border, in place since the migrant crisis took hold last year, as one of the new threats to media freedom emerging over the past year.

By contrast, the Czech Republic leapt 20 places in the ranking to 20th out of a total of 180. The defeat of Andrej Babis in October’s election was key, RSF said. The billionaire, who owns two major newspapers and radio stations, regularly attacked the media, and restricted access to government information and resources during his time as prime minister.

Its early days yet, but the new centre-right government has pledged to halt these practices. “We will not restrict any media in their activities and we will not hinder any journalists in their work,” the professorial prime minister, Petr Fiala, pledged. “The practices of restricting participation in press conferences, limiting access to information and selectively placing state advertising are fundamentally alien to me.”

However, the ranking only earns Czechia a label of “satisfactory”. RSF notes that the mainstream media remains dominated by oligarchs and other powerful – and often reclusive – business groups.

Political pressure also persists, the report points out. “Unrestrained attacks on journalists from the highest ranks of government, especially President Zeman, have led to citizens’ growing distrust of journalists,” RSF notes. Populist political forces also maintain hostility towards the independence of public media.

An unregulated online information space that encourages fake news and propaganda is another concern, the report says. The authorities have long noted the proliferation of disinformation websites in the country, often Russian-linked.

Hungary rose seven places to 85th, though remains one of the so-called “problematic” countries with only Bulgaria and Greece below them among EU nations. Slovakia rose eight places to 27th.

Was it really better with Babis? Police not at fault for Czech ‘George Floyd’
“It was better with Babis!”. Or at least that’s what Petr the waiter, Nikola from the city council and teacher Nela say.

And regardless of whether they actually exist or not, the trio firmly believes that life was better under Andrej Babis, whose time in the prime minister’s chair ended at the last election in December. So much better than under the centre-right coalition that ousted him that they’ve popped up this week on billboards all over the country to shout about it.

Quite why is not clear. But it’s definitely not an election campaign, insist officials from the ANO party, which Babis – who simply can’t decide whether or not to run for president in January even though a term in Prague Castle is now his best bet to avoid being jailed for fraud – bankrolls. There’s also no connection, the officials added, with municipal and Senate elections in September.

A good performance in September would offer Babis momentum ahead of the presidential election to select a replacement for President Milos Zeman, whose second and final term ends in March. Babis currently leads the polls, though he hasn’t said whether he will run, and the five parties of the governing coalition have yet to put any candidates in place.

One person keeping everything crossed that the billionaire gets the gig is apparently his wife Monika. On her billboard, she states: “It was better with Babis! Now it stinks at home.” It has not been confirmed whether or not this billboard is genuine.

Meanwhile, while the police made several mistakes during the June 2021 incident in Teplice during which 46-year-old Stanislav Tomas died, they committed no crime against the Roma man, Deputy Ombudsperson Monika Simunkova stated in her report into the incident published on Monday.

The arrest, during which police knelt on Tomas’s neck for more than six minutes, provoked claims of brutality and racism, as well as comparisons to the death of George Floyd in the US. The officers in that incident in the US are now serving prison sentences for murder. However, just 24 hours after Tomas’ death, then prime minister Babis and other members of his government declared that the police had acted entirely correctly.

Simunkova said in her report that the use of force in dealing with Tomas was appropriate. Heart failure due to methamphetamine intoxication was the cause of death she confirmed. But she added that the officers failed to monitor Tomas, and even continued to kneel on his neck after he had stopped moving or breathing. No first aid was administered and there was an unacceptable delay in calling an ambulance. The officers also did not switch on their body cameras. The deputy ombudsperson, whose report was made public 11 months after Tomas died, has asked the Czech police to take her findings on board.

Poland second only to US in help for Ukraine
Poland was second in the amount of help it has provided to Ukraine since the war started, according to an analysis by the Kiel Institute for the World Economy. Poland has given 2.5 billion euros in aid, in addition to receiving up to 3 million refugees. That amount of cash is second to only the US, which has provided 10.3 billion euros. UK, Canada, Germany and France are the next biggest donors on the list.

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