Hungarian Prime Minister Viktor Orban secured a temporary waiver from U.S. sanctions on Russian energy imports during a high-profile meeting with President Donald Trump, but the agreement required Hungary to make substantial purchases of American energy products and technology while failing to deliver on Orban’s hope for a Budapest-hosted peace summit to end the war in Ukraine.
The meeting between Trump and Orban at the White House underscored their political alliance, with Trump granting Hungary a one-year exemption from sanctions targeting Russian oil, gas, and nuclear supplies. This relief prevents potential utility bill hikes for Hungarian households, as Orban argued that Hungary’s landlocked geography leaves no viable alternatives to Russian crude. Trump acknowledged this point, emphasizing the strategic importance of the exemption amid ongoing European energy tensions.
In exchange, Hungary committed to significant energy purchases from the United States, including a $600 million deal for liquefied natural gas and agreements to buy American nuclear fuel rods for its Paks nuclear plant. The deal also involves Hungary acquiring technology for extended storage of spent nuclear fuel and exploring the purchase of up to 10 small modular reactors from U.S. firms, with costs estimated between $10 billion and $20 billion. These steps aim to diversify Hungary’s energy mix while boosting U.S. exports and technological cooperation.
However, the exemption is time-limited to one year, contradicting Hungarian officials’ claims of an indefinite waiver, and it requires alignment with EU efforts to phase out Russian energy by 2027. Critics note that Hungary has increased its reliance on Russian oil since the Ukraine invasion, from 61% to 86% of imports, and that alternative pipelines like the Adria route from Croatia could reduce dependence. The U.S. decision appears tailored to support Orban ahead of Hungary’s challenging April elections, where he faces growing opposition.
Orban’s visit fell short on key diplomatic fronts, as he failed to secure the reinstatement of a dual taxation agreement abolished in 2022, which hampers bilateral trade. More notably, plans for a Trump-Putin peace summit in Budapest, announced in October but later canceled, were not revived, leaving Orban without a major foreign policy achievement. His aspirations to mediate in the Ukraine conflict remain unfulfilled, with no signs of renewed talks from the Trump administration.
The meeting drew criticism from U.S. senators and European allies, who argue that Hungary’s energy dependence undermines collective security and emboldens Russia. A bipartisan Senate resolution urged Hungary to end its reliance on Russian fossil fuels, stressing that all NATO allies should adhere to uniform standards. Within the EU, Hungary’s stance has fueled tensions, as the bloc pushes for tighter sanctions and support for Ukraine, while Orban has vetoed certain measures and criticized aid to Kyiv.
Economically, the sanctions exemption offers short-term stability for Hungary, averting sharp utility cost increases that Orban warned could have tripled. Discussions on a currency swap between U.S. and Hungarian central banks could further enhance financial security, mirroring recent deals with Argentina. Yet, the long-term costs of new energy investments and the political risks of aligning closely with Trump’s policies may challenge Orban’s government domestically and in European relations.
In summary, the Orban-Trump meeting produced a pragmatic but costly arrangement, providing temporary sanctions relief in exchange for embracing American energy exports. While it strengthens bilateral ties, it highlights enduring divisions in European energy policy and leaves the broader goal of Ukrainian peace unresolved, with Orban’s political future increasingly tied to these international dynamics.
