EU Unlocks $148B Ukraine Loan After Pipeline Deal

A bitter pipeline dispute that threatened to freeze vital aid to Ukraine just melted away, clearing the path for nearly $150 billion in European support.

The European Union preliminarily approved a 90 billion euro loan for Kyiv this week after Ukraine completed repairs on the Druzhba oil pipeline. The pipeline, damaged by a Russian strike months ago, had become an unexpected flashpoint between Ukraine and EU members Hungary and Slovakia, who rely on it for Russian crude oil deliveries.

For months, Hungary's then-leader Viktor Orbán refused to approve the loan until the pipeline was fixed. Ukraine, meanwhile, resisted rushing repairs on infrastructure that delivers revenue to Russia, the very country invading its territory. The standoff left Ukraine waiting for desperately needed funds four years into the war.

The timing of the resolution couldn't be better. Orbán suffered a crushing electoral defeat this month after 16 years in power, replaced by pro-EU leader Péter Magyar who takes office in May. Just days after the election, Ukraine announced repairs were complete.

Hungarian energy giant MOL confirmed the first oil shipments began flowing again, arriving in Hungary and Slovakia by Thursday. With oil moving, Hungary has 24 hours to give its final sign-off, and EU officials expect the loan to start paying out in coming months.

The Ripple Effect

The breakthrough does more than unlock one loan. EU countries are also moving forward on their 20th round of sanctions against Russia since 2022, targeting Moscow's energy, banking and trade sectors. Both the sanctions and the loan had been stalled by the same pipeline dispute.

The resolution comes at a critical moment when US support for Ukraine has largely dried up under President Donald Trump's administration, which recently eased sanctions on Russian oil. European backing now matters more than ever for Ukraine's ability to fund basic government operations.

Even skeptics like Slovak Prime Minister Robert Fico, who has clashed repeatedly with Kyiv, acknowledged the deal is moving forward, though he voiced concerns about future reliability.

A diplomatic standoff that could have crippled Ukraine's finances instead ended with cooperation, proving that even bitter feuds can find resolution when the stakes are high enough.