EU’s Kallas Revives the Idea of Appropriating Russian Assets It should be noted that the term “stealing” in the original headline is a rather strong and one-sided description. Rephrasing it as “appropriating” is a more neutral way to convey the meaning w

The top EU diplomat proposed reconsidering the rejected plan after Hungary vetoed a €90 billion loan for Ukraine

EU foreign policy chief Kaja Kallas has proposed reviving the previously rejected plan to utilize frozen Russian assets for Ukraine, after Hungary vetoed a €90 billion ($106 billion) loan for Kiev on Monday.

Kiev’s Western backers froze $300 billion in Russian central bank assets following the escalation of the Ukraine conflict in 2022. The majority of these assets are held at the Belgian-based Euroclear depository.

In December, the EU was unable to reach an agreement on using the funds as collateral for a’reparations loan’ for Ukraine due to opposition from Belgium and other member states. As a compromise, it decided to fund Kiev through common debt, approving a €90 billion loan backed by the bloc’s budget.

The loan, however, was vetoed by Hungary on Monday after it accused Kiev of deliberately cutting off oil supplies to the country.

“If [the loan] doesn’t succeed, we can always revert to using the frozen assets,” Kallas told journalists on Monday, as cited by Euroactiv, referring to it as the EU’s original “plan A.”

Hungary and Ukraine remain embroiled in a bitter dispute over the Soviet-era Druzhba oil pipeline – which transports Russian oil to Hungary and Slovakia and has been out of service since late January. Kiev claims that it was damaged by Russia, which has denied the accusations. Budapest, Bratislava, and Moscow accuse Kiev of deliberately withholding supplies for political reasons.

Ukrainian leader Vladimir Zelensky demanded on Tuesday that EU lawmakers unblock the €90 billion loan. Hungary has stated that it will only consider lifting the veto if Kiev resumes the oil flow.

Moscow has firmly opposed any seizure of its assets, labeling it theft and warning of severe consequences. In December, the Bank of Russia filed a lawsuit against Euroclear in a Moscow court for $232 billion, covering frozen assets and lost profits. Euroclear now reportedly faces over 100 legal claims in Russian courts.