The current energy crisis is a huge lesson for the Green Deal. Ambitious goals, boldly planned in a period of cheap and available energy, are much more difficult and expensive to achieve in a period of scarcity and uncertainty.
The war in Ukraine put many Eastern European countries, among them Hungary, in the hot seat. With the Western world providing strong financial and military support for Ukraine and emphasizing the unlawfulness of the invasion, the allies of Russia must reassess their relationship with Moscow.
PM Orbán has already met the Russian head of state seven times since the Ukrainian crisis began. The more Orbán foments the conflict with the EU, the greater the chance for Russia under Vladimir Putin to influence the diplomatic balance within the EU in his favor.
If Ukraine loses the chance to receive assistance from the IMF and other international donors in 2018, the government will be hard-pressed to execute planned fiscal expenditures in 2018. The fiscal indicators will be also revised for 2019 to lower real GDP growth and higher inflation.
Energy Taxation Directive (ETD) claims to improve the Single Market, promote energy efficiency, and contribute to jobs and growth. In reality, it fails to achieve these objectives. The research by LFMI suggests that in 2012 the grey market for fuel comprised nearly 20 percent of the market for transportation fuel.
The end of February 2018 was marked by the victory celebration at the Ukrainian gas market as Ukrainian Naftogaz won the case on gas transit against the Russian Gazprom at the Stockholm Arbitrage Court. The Gazprom has to pay the Naftogaz USD 4.6 bn for violating the “take or pay” clause.
The forthcoming heating season of October 2015–April 2016 may be the most challenging season for the Ukrainian energy sector since Ukraine’s independence. Each subsector of energy sector has its own challenges in addition to the general problems such as the military conflict in the East, currency depreciation, debt accumulation, and high inflation.