Hungary’s plans to move away from Russian oil and gas could come with a hefty price tag, according to a Russian energy analyst. While the country is exploring alternative supplies, Igor Yushkov warns that ending long-term contracts ahead of schedule could expose Hungarian companies to financial penalties on top of the higher cost of replacement energy.

The warning follows Foreign Minister Anita Orbán’s announcement that Hungary intends to end its dependence on Russian energy supplies earlier than the European Union’s deadlines. As previously reported, Hungary’s target for becoming independent of Russian gas is October 2027.

In an article published by Russian outlet V Fokuse Mail, Igor Yushkov, an expert at Russia’s Financial University under the Government of the Russian Federation and the National Energy Security Fund, warned that Hungary could face both higher energy costs and contractual penalties if it ends its Russian gas supplies before the EU ban takes effect.

Details: FM Anita Orbán shares the deadline set for Hungary to stop importing Russian gas

Could Hungary still have to pay Gazprom?

One of the biggest risks identified by Yushkov concerns existing long-term gas supply contracts. He argues that if Hungary stops purchasing Russian gas voluntarily, Gazprom could demand compensation for terminating the agreements early.

The situation could be different if deliveries were interrupted because of sanctions. In that case, Hungarian companies might be able to invoke force majeure provisions. However, if they decide to end the contracts themselves, they could face contractual penalties, according to the analyst.

This could leave Hungary paying twice: first for potentially more expensive alternative gas supplies and then for compensation related to the cancelled Russian contracts.

The exact financial consequences would depend on the terms of the agreements and how any early termination was handled. No specific penalty amount has been established.

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Replacing Russian oil will also cost more

The transition could prove challenging for oil supplies as well. Anita Orbán has said that MOL is examining the possibility of sourcing crude oil from non-Russian suppliers and transporting it to Hungarian refineries through Croatia’s JANAF pipeline system.

Yushkov argues that replacing Russian crude is technically possible, but would require more expensive purchases and transportation. Refineries could also need to blend different types of crude to maintain production.

The analyst believes these additional costs could eventually feed through into fuel prices.

Another immediate complication concerns US sanctions. A temporary exemption allowing purchases of oil from Russian companies Lukoil and Rosneft is due to expire on 21 November.

Meanwhile, negotiations are under way over the potential purchase of the Russian-owned stake in Serbia’s NIS oil company. Orbán has said MOL, as well as the Russian and Serbian sides, are interested in completing the transaction in time.

Higher energy prices could affect households

The potential consequences would not be limited to the oil market. Yushkov also warns that more expensive natural gas could push up the cost of electricity, heating and hot water.

However, his assessment represents the view of a Russian energy analyst, rather than a confirmed forecast of what Hungarian households will pay. The actual impact will depend on alternative supply prices, infrastructure capacity, contractual arrangements and the government’s energy policies.

Yushkov also pointed to Hungary and Slovakia’s legal challenge against the EU’s planned ban on Russian gas imports. The two countries previously argued that such restrictions should require unanimous approval by member states. The EU, however, treated the measure as an internal market decision that could be adopted by qualified majority voting.

The case has not yet been withdrawn. Yushkov believes Hungary’s closer alignment with Brussels under its new political leadership could eventually lead to the legal challenge being dropped, potentially putting pressure on Slovakia to follow suit.