In a move that is shaking up the delicate balance of Western unity against Russia, Hungarian Prime Minister Viktor Orban walked away from the White House on November 7, 2025, with a prize he’d long coveted: a one-year exemption from U.S. sanctions on Russian oil and gas. This unprecedented waiver, granted by President Donald Trump during their first bilateral meeting since Trump’s inauguration, allows Hungary to continue importing Russian energy despite a sweeping Western embargo designed to choke off the Kremlin’s war chest. In return, Hungary has pledged over $1.4 billion in purchases from U.S. nuclear, defense, and energy sectors, marking a new chapter in the two countries’ economic and diplomatic relationship.
The high-stakes meeting, held in the shadow of Russia’s ongoing war in Ukraine, was a diplomatic coup for Orban. As reported by Reuters and Politico, the Hungarian leader secured not only the exemption he sought but also a series of lucrative economic agreements. Among them: a memorandum of understanding valued at $20 billion for civil nuclear cooperation, including the construction of 10 small modular reactors in Budapest using American technology. Hungary also agreed to purchase $114 million in nuclear fuel from U.S.-based Westinghouse, $600 million in liquefied natural gas, and $700 million in defense materials.
Trump justified the sanctions waiver by citing Hungary’s landlocked geography and lack of seaports, arguing, “it’s very difficult for him to get the oil and gas from other areas.” This rationale, however, stands in stark contrast to Trump’s earlier pressure on European allies to cut off Russian energy imports as a means to isolate Moscow economically. According to BBC analysis, Hungary and Slovakia together have paid Russia $13 billion for oil since the February 2022 invasion of Ukraine, a figure that underscores the financial lifeline these purchases provide to the Kremlin.
The implications of the exemption are far-reaching. It marks the first formal breach in the Western sanctions wall, threatening to unravel the unified front that has been one of the West’s primary tools against Russian aggression. “If a NATO and EU member can obtain preferential treatment on Russian energy, other nations may seek similar exemptions, accelerating the collapse of coordinated economic pressure,” Politico warned. The move also emboldens Orban—a leader who has repeatedly vowed to veto Ukraine’s accession to the European Union and opposes its NATO membership—to maintain financial flows to Russia while blocking Kyiv’s integration into Western security structures.
Orban’s White House visit was laden with symbolism and strategic messaging. Trump lavished praise on his guest, calling him a “great leader” and a “beloved leader” who could serve as an example to European politicians. During a luncheon, Orban was seated between Trump and Vice President J.D. Vance, a gesture that underscored the closeness of the two leaders. Trump also seized the opportunity to criticize European migration policies, contrasting them with Orban’s hardline stance and warning, “I told European leaders that they had better stop this, because otherwise there will be no more Europe. They have done something very dangerous.”
Yet the real drama played out over Ukraine. Orban, who has consistently echoed Kremlin talking points, characterized the war as unwinnable for Ukraine and positioned himself and Trump as the only “pro-peace” leaders in the West. When Trump asked, “Are you saying that Ukraine cannot win this war?” Orban replied with a shrug, “Miracles can happen.” CNN noted that Orban’s rhetoric closely paralleled Russian arguments, while Politico observed that this stance isolates Ukraine diplomatically by casting support for its military resistance as misguided.
The economic agreements struck during the visit are significant not only for their size but also for their strategic implications. The $20 billion nuclear deal includes the construction of 10 small modular reactors in Hungary—a move designed to power the country’s growing battery manufacturing sector and diversify its energy sources. The U.S. agreement to supply $114 million in nuclear fuel to Hungary’s Paks 1 power station, which currently provides about 40% of the nation’s electricity, could help restart the long-delayed Paks 2 expansion project, previously hampered by technical and licensing issues tied to Russian involvement.
Orban was quick to frame the outcome as a diplomatic masterstroke. Speaking to Hungarian media, he declared, “We have been granted complete exemption from sanctions in the case of imports coming through the Turkish Stream and Friendship pipelines. There are no sanctions that would restrict or make supplying Hungary this way more expensive. This is a general exemption with no time limit.” However, a White House source later clarified to Reuters that the exemption is, in fact, limited to one year. Notably, the waiver is set to expire just after Hungary’s April 2026 election, raising questions about its true motivation—energy security or domestic political gain.
While the economic package was welcomed by Hungary, not everything on Orban’s wish list was granted. The two sides failed to resolve the thorny issue of the U.S.-Hungarian double taxation avoidance agreement, a long-standing point of contention that continues to create uncertainty for investors and companies operating across the two countries. The lack of progress on this front was a disappointment for Hungary’s business community, which had hoped for relief from the administrative and financial burdens imposed by the agreement’s termination in 2024.
Meanwhile, the exemption has sent ripples of concern through Western capitals and within the U.S. Congress. Lawmakers who control military aid to Ukraine now face the uncomfortable reality of supporting a country whose NATO ally is simultaneously undermining sanctions on Russia’s main revenue source. The prospect of other nations seeking similar waivers could rapidly fragment the coordinated sanctions regime, weakening one of the few remaining levers the West has to constrain Moscow’s war effort.
Adding to the geopolitical intrigue, Trump revived the idea of hosting a peace summit in Budapest with Russian President Vladimir Putin—a proposal that, if realized, would likely sideline Ukraine and tilt the diplomatic playing field in Russia’s favor. “If we have it, I’d like to do it in Budapest,” Trump said, signaling a willingness to negotiate an end to the war on terms that may not align with Kyiv’s interests or those of most NATO allies.
Critics argue that Hungary’s growing dependence on American energy and nuclear technology merely swaps one form of reliance for another, while Orban’s government insists it is pursuing greater diversity of supply. Industry experts, such as university professor Attila Aszódi, have welcomed the entry of new actors into Hungary’s energy market, noting that the agreements with Westinghouse and potential U.S. small modular reactor builders could eventually reduce Russian influence—though such changes will take years to materialize.
As the dust settles from Orban’s Washington visit, one thing is clear: the carefully constructed edifice of Western sanctions against Russia has developed its first major fissure. Whether this crack widens into a full-blown breach depends on how other nations respond—and whether the U.S. and its allies can maintain a united front in the face of mounting economic and political pressures.
