Why Viktor Orban wants energy prices at the heart of Hungary’s elections

How do you blow up a pipeline? Two backpacks stuffed with plastic explosives would seem to do the trick. 

Serbian President Aleksandar Vučić on Sunday said that investigators had uncovered what he said were explosives of "devastating power" near the village of Trešnjevac in northern Serbia, not far from the crucial Balkan Stream pipeline – an extension of the Black Sea-spanning TurkStream pipeline – that carries Russian natural gas into Hungary. 

The head of Serbia’s military intelligence agency said the alleged discovery of two rucksacks packed with plastic explosives and detonators stemmed from information that a military-trained figure "from a group of migrants" had for weeks been planning a sabotage operation on the country’s critical energy infrastructure.

He alleged that the bomb parts had been made in the US, though stressed that the identity of those responsible for the explosive plot was still being investigated. 

Hungary’s nationalist Prime Minister Viktor Orban hasn’t been as reserved. While not going so far as to directly accuse Ukraine of being behind the attempted sabotage, he publicly linked the plot to Kyiv’s ongoing bombing campaign against Russian oil and gas infrastructure.

"Ukraine has been for years trying to cut off Europe from Russian energy," he said in a Facebook post following an emergency defence council meeting hours after the discovery. "The Russian section of TurkStream is also under continuous military attack. Ukraine's efforts pose a life-threatening danger to Hungary."

Read moreWhy Hungary's Viktor Orban is vilifying Ukraine before crucial elections

Orban’s post also pointed to the 2022 sabotage of the Nord Stream gas pipelines linking Russia to Europe via Germany. Two Ukrainian nationals have been arrested in different European countries in connection to the attacks, which Kyiv maintains it was not responsible for.

Kyiv on Sunday denied any involvement with the reported discovery in Serbia, instead suggesting Moscow had carried out a "false flag" operation to shore up public support for Orban. The Hungarian premier has repeatedly opposed EU sanctions against Russia following its 2022 invasion of Ukraine, and continues to call for the bloc to mend ties with Moscow. 

The timing of the alleged plot has raised eyebrows. Hungarians will vote this Sunday in the country’s parliamentary elections, which independent polls have suggested could see Orban voted out after 16 years in power in favour of his former ally, the centre-right Peter Magyar.  

Magyar himself has been sceptical about the reported discovery.

“Many people have suggested that something might ‘accidentally’ happen in Serbia, possibly involving a gas pipeline, around Easter, one week before the Hungarian elections. And now it has,” he wrote on social media Sunday.

“If Orban and his propaganda machine use this provocation for campaign purposes, it will amount to an open admission that it was a pre-planned false-flag operation.”

'Blackmail'

It’s not hard to see why the Hungarian opposition is suspicious. If real, a Ukrainian plot to blow up a pipeline bringing Russian natural gas into the country would vindicate months of warnings from Orban that Kyiv was trying to throttle Hungary’s energy access.

Ukraine’s “blockade”, as he describes it, is designed to "blackmail" voters to vote the prime minister out on Sunday – and to punish the country for continuing to fund Moscow’s four-year war by buying Russian oil and gas. 

The two countries have for months been locked in a bitter standoff over the ongoing closure of the Druzhba – or Friendship – pipeline that carries Russian crude through Ukraine into Hungary and Slovakia. Both Bratislava and Budapest rely heavily on Russian oil and gas to meet their energy needs.

Kyiv, which bombed Russian sections of the pipeline at least five times last year as part of its strategy of strangling Moscow’s oil exports, said that a Russian drone strike on Ukrainian territory in late January had put the pipeline out of operation. 

Orban has repeatedly accused Kyiv of dragging its heels on repairing the pipeline, which Ukraine denies. The prime minister is using Hungary’s veto power in the EU to block a proposed €90 billion loan to Ukraine until the oil starts flowing again. 

A real – and successful – plot to blow up the pipeline would have far-reaching consequences for Hungary. Imported Russian gas makes up some 60 percent of the country’s final gas consumption, with TurkStream carrying between 5 and 8 billion cubic metres of gas across the border every year. 

More than half of that goes directly to households, who use it mainly for heating, with another quarter going to industry. In total, almost a fifth of Hungary’s electricity generation is powered by natural gas, according to the International Energy Agency. 

Borbála Takácsné Tóth, a senior researcher at Hungary’s Regional Centre for Energy Policy Research, said that gas played an outsized role in the country’s energy mix.

“For historical reasons, Hungary is much more gasified than the average EU country, meaning that Hungarian households use gas as a domestic heating source much more than average EU consumers do,” she said. “And for this, it means that Hungarian voters are more or less Hungarian gas consumers.”

Orban has long championed state intervention in energy prices, including subsidising domestic gas and electricity prices that households depend on. The prime minister in March announced price caps on petrol and diesel in response to the worsening oil shock triggered by the US-Israeli war on Iran. 

Tóth said that Orban's costly energy subsidies had been funded in large part due to the country’s access to cheap Russian Urals crude, with the government levying a hefty windfall tax on Hungary's oil and gas giant MOL as it raked in record profits.

“Because of the difference between the Brent price and the Russian price, it was pretty financially beneficial to purchase the Russian oil,” she said. “And the huge price difference, 95 percent of that was just taken away from MOL in the form of taxes ... and this is why they could afford, on the other hand, to subsidise the gas consumers.”

Fuelling panic

Orban and his officials have made energy security a cornerstone of their election campaign, accusing Magyar and his Tisza party of putting these cheap energy prices at risk. Magyar himself has been characteristically evasive on whether he would maintain the subsidies, instead hammering what he describes as years of widespread corruption under the nationalist premier. 

And while Magyar has called for Hungary to move away from its dependence on Russian oil and gas, he has given the project a distant deadline of 2035 – years after the 2027 cutoff called for by the European Union, and one that coincides with the end of the long-term contracts signed by Moscow and Budapest that could see Hungary pay dearly if it abruptly stops buying Russian gas. 

Read more’Ready to govern’ Hungary: Former ally Magyar challenges Orban with Europe gun

Katja Yafimava, a senior research fellow at the Oxford Institute for Energy Studies, said that while Hungary had viable alternatives to help wean itself off Russian natural gas by 2027 – including increasing imports of liquefied natural gas (LNG) through ports on the Adriatic Coast – increased transport costs could well lead to moderately higher prices. 

She stressed that the unfolding energy crisis caused by the spiralling conflict in the Middle East made the cost of such a transition more uncertain.

“Importantly, this was the picture before the start of the Iran war, when the global LNG wave was widely expected to start coming to the market in 2026 and increase thereafter, resulting in lower LNG prices,” she said. “This picture has become more precarious as the war led to the Strait of Hormuz being effectively closed and Qatari LNG production stopped.” 

Roughly a fifth of the world's LNG passes through the narrow waterway, which Tehran has effectively closed to most maritime traffic. Qatar, the world's second-largest exporter of LNG, has also seen its capacities take a hit – the Gulf state's officials told Reuters in March that Iran’s retaliatory strikes had knocked out almost a fifth of the country’s LNG export capabilities. 

“Under more pessimistic – and seemingly more likely – scenarios under which Qatari production will not be returning before winter 2026 and potentially beyond, prices would increase very significantly,” Yafimava said. “Making the Russian gas phase-out markedly more difficult for Hungary, as it would have to pay much more for replacement LNG cargoes in a tighter market compared to the pre-Iran war outlook.”

Standing next to the untouched Balkan Stream pipeline in southern Hungary on Monday, Orban once again urged Europe to lift its restrictions on Russian oil and gas exports to better endure what he described as the burgeoning energy crisis unleashed by the Iran war.

"Europe is nearing an extremely serious energy crisis, and the coming days will be critical," he said.

Tóth said that Orban had not been shy about pressuring voters with the threat of higher energy bills if they cast a ballot for his opponent.

“The number-one propaganda tool of Fidesz in the domestic arena is to refer to cheap household energy prices,” she said. “And lately, it’s not only that it's cheap energy, but it's cheap Russian energy. That's something new from the last few years. And if you want to keep the low energy prices, then you have to vote for Fidesz – that’s the easiest message.”