Sanna Torén Björling: The game about Russian oil will continue

The recent approval of a 90 billion euro EU loan for Ukraine marks a critical, albeit temporary, lifeline for a nation relentlessly defending itself against Russian aggression. As Sanna Torén Björling writes for Dagens Nyheter, this financial injection is not a windfall but a necessary measure to keep Ukraine's budget and defense afloat. The funds are earmarked for essential expenditures like salaries for state employees and the purchase of weapons, highlighting the dire economic straits Ukraine finds itself in.

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Finally! With the EU loan, Ukraine can manage its budget and defend its country – for a while.

Björling points out that while the loan provides a much-needed "breath of oxygenated air," it does not create any surplus. Ukraine's currency, the hryvnia, is already heavily committed, and the budget remains dependent on foreign support. The loan covers a significant portion of the 2026/27 budget, but a substantial deficit in the defense budget for the current year, nearly 20 billion euros according to the Kyiv Independent, underscores the ongoing financial strain.

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For Kyiv, the money comes at the eleventh hour.

Furthermore, Ukraine faces the complex task of implementing reforms demanded by the International Monetary Fund (IMF). These reforms, including unpopular tax changes, have met resistance in the Verchovna Rada, Ukraine's parliament, indicating the difficult balancing act between securing international aid and maintaining domestic political stability. The ongoing negotiations over these demands suggest that the path ahead remains fraught with financial and political challenges.

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Ukraine's state budget and defense have been entirely dependent on foreign support since the invasion war began.

From our perspective at Dagens Nyheter, the "game about Russian oil" continues to be a central theme. The loan's approval, facilitated by Hungary's eventual agreement after initial resistance, is intertwined with energy politics. Russia's potential to manipulate oil supplies, as seen with threats regarding Kazakh oil transit, serves as a constant reminder of Moscow's leverage. Björling's commentary emphasizes that while the EU loan is a positive development for Ukraine's immediate survival, the underlying geopolitical and economic pressures, particularly those exerted by Russia, remain formidable. The story is not just about financial aid; it's about the intricate web of international relations, energy security, and the ongoing struggle for Ukraine's sovereignty.

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Russia, with Orbán's departure, sees an ally disappear, has countered the change in Hungary by threatening to tighten another channel.