Hungary taps into Turkish gas deal. Is Russia the secret supplier?

Following the agreement reached in August last year between the Hungarian company MVM and the Turkish conglomerate BOTAŞ, the natural gas supply from Turkey to Hungary has commenced. However, the Centre for Eastern Studies experts suggest that some of this gas might be sourced from Russia.

The Hungarian government has said the deal with Turkey will boost the nation's energy security and help stabilize domestic gas market prices. Significantly, gas consumption in Hungary dropped by 18.2 percent in the first half of 2023 compared to the same timeframe the previous year, totaling about 166 billion cubic feet during the year's first six months.

Nevertheless, as analysts have pointed out, there are concerns about the true origin of the gas supplied from Turkey to Hungary. They suggest it's possible that a portion of it could be Russian gas being re-exported as part of Turkey's so-called 'Turkish blend.' This strategy involves purchasing fuel from various sources, enhancing domestic production, and re-exporting some of this gas.

This situation leads to queries in the European Union about whether such imports truly diversify the energy supply away from Russian gas or if they merely allow Russia to covertly expand its gas exports to the EU market. Despite these concerns, Brussels has yet to enforce any restrictions on importing Russian gas or LNG, and the noticeable reduction in Russian supply mainly results from Moscow's own measures.

In December, a few months after the gas agreement was signed, Hungarian Prime Minister Viktor Orban and President Erdogan penned a strategic partnership agreement in Budapest. "Turks and Hungarians will be winners together in the 21st century," Orban proclaimed during a joint press conference.