Brussels is preparing for the possibility that Hungary may block the renewal of European Union sanctions against Russia, a move that could unfreeze tens of billions of euros in assets and undermine Ukraine's financial aid structure. With the current measures set to expire on March 15, EU officials are scrambling to find a solution before the restrictions legally lapse.

There is eerie quiet in Hungarian media over the issue and there have been no signals from officials on what the Orban government's next move will be as Hungary prepares for politically intense March 15 national holiday, the anniversary of the anti-Habsburg uprising.

The sanctions package in question covers more than 2,400 Russian individuals and entities, including high-profile figures such as President Vladimir Putin, Foreign Minister Sergei Lavrov and top oligarchs. If not renewed, these individuals would be free from travel bans and asset freezes, while Russian companies could regain access to frozen funds.

The EU's sanctions regime against Russia has been in place since 2014, following the annexation of Crimea. These restrictions have been continuously expanded, particularly after the full-scale invasion of Ukraine in 2022. However, a key procedural rule remains: sanctions must be renewed every six months by unanimous approval of all 27 EU member states.

Hungary frequently leveraged this requirement to extract concessions from Brussels, but this time, sources in the European Commission suggest that Budapest has not made explicit demands, leading to uncertainty over its endgame.

European Pravda was told by an EU source that Hungary's EU ambassador at the March 10 meeting said that they had no mandate to make a decision on renewing the sanctions. Hungarian representatives in Brussels had not responded to a request for comment to the news outlet.

Some European diplomats fear that Budapest's stance is influenced by broader geopolitical calculations, particularly its alignment with US President Donald Trump's policy preferences.

If the sanctions lapse, an estimated €60bn, or a third of all frozen Russian assets, could be at risk of being moved out of Europe before new restrictions can be imposed. This would not only undermine Ukraine's ability to finance its reconstruction but could also weaken EU leverage over Moscow.

The potential unfreezing of Russian assets is not just a geopolitical concern but also a significant financial risk. The EU currently holds around €210bn in Russian state and private funds, with the majority parked in Belgium's Euroclear securities depository. A lapse in sanctions could disrupt recent EU efforts to channel windfall profits from these frozen assets into Ukraine's war and reconstruction effort.

Multiple sources say that Hungary initially sought to have eight individuals removed from the sanctions list, but these demands are no longer heard.

According to an earlier report by Bne IntelliNews, the Russian investigative unit of Radio Free Europe (RFE), Systema, published the names of Russian individuals Hungary seeks to remove from the EU sanctions list.

If Hungary is successful in forcing a reassessment of individual sanctions, it could set a precedent for challenging broader economic restrictions. European officials worry that this could weaken the entire framework of EU sanctions, making future renewals increasingly contentious.

While some EU officials remain cautiously optimistic that Hungary will eventually back down, others warn that Budapest's unpredictability makes the situation precarious. If a lapse occurs, the EU would need to act swiftly to reimpose measures, but any delay could allow Russia to repatriate billions in assets.

For now, European negotiators are employing all available diplomatic tools, including private discussions with Hungarian officials and backchannel negotiations.

EU ambassadors will convene for another critical session on March 14, the eve of the deadline. If Hungary continues its blockade until March 15, the issue will be raised at the EU Foreign Affairs Council meeting on Monday, March 17. There, foreign ministers from 26 EU states will seek ways to put pressure on Hungary to approve the sanctions' extension, European Pravda writes.