A loan of 90 billion euros: under what conditions will the EU provide funds to Ukraine?
Прапори ЄС. Фото - Reuters
The EU Council has approved amendments to the EU’s long-term budget, allowing for a loan of €90 billion to Ukraine in 2026–2027. Hungary lifted its veto after the resumption of Russian oil transit through the Druzhba pipeline.
This is reported by “European Truth” .
How Hungary lifted the veto
Hungarian Prime Minister Viktor Orban blocked the procedure in early 2026 after oil transit was halted in January due to damage to a pumping station in the Lviv region by a Russian missile attack. Druzhba resumed operations on April 22, which was the basis for lifting the veto.
Hungarian officials were waiting for physical confirmation that the oil had crossed the Slovak-Hungarian border before sending confirmation to the EU Council Secretariat under an urgent written procedure. The loan involves 24 of the 27 EU member states – all but Hungary, Slovakia and the Czech Republic.
Loan terms and who will repay it
Legally, the loan is structured as a loan with limited recourse: Ukraine is obligated to repay it only if it receives reparations from Russia. In the event of non-payment of reparations, the responsibility for payments passes to the 24 member states participating in the loan.
The European Union will cover the interest rates on the loan from its budget – servicing costs will amount to about 1 billion euros in 2027, and from 3 billion euros per year thereafter.
Allocation of funds: weapons and budget
The funds are distributed as follows: €60 billion is allocated to military support, €30 billion to budgetary support. The military funds will be provided without any conditions.
The first defense tranche will amount to 6 billion euros and will be aimed at the purchase of Ukrainian-made drones, in particular using Chinese components, for which an exception to the general rules has been agreed. The loan terms allow for financing deals concluded from January 2026.
Budget support of EUR 16.7 billion for 2026 is divided into 2 equal parts: EUR 8.35 billion will be provided through the Ukraine Facility, and another EUR 8.35 billion through the macro-financial assistance mechanism.
Payment schedule
The first budget disbursements will be made through the macro-financial assistance mechanism, as it does not impose complex reform conditions and focuses mainly on financial management issues. Disbursements are planned in three tranches:
- 3.2 billion euros – no later than June 2026;
- 3.7 billion euros – approximately in the summer or immediately after the summer;
- 1.45 billion euros – closer to late autumn.
Ukrainian President Volodymyr Zelenskyy expects the first tranche to arrive in May-June. In addition, in the near future — in May or early June — Ukraine may receive a tranche of 2.7 billion euros under old obligations under the previous “Ukraine Facility.”
“This will be the last payment under the old Ukraine Facility. A new list of reforms will follow,” the source of the publication said.
Reforms as a condition for receiving budget funds
The terms of receiving funds through the “Ukraine Facility” are currently being agreed between the European Commission and Kyiv. According to the publication, the list of reforms may include elements of the so-called “10 points of Kachka-Kos” – those reforms that are considered the most urgent in the field of the rule of law and combating corruption. All of them will relate to the obligations that Ukraine has already undertaken as part of the EU accession process.
To legally formalize the loan, the European Commission is developing 3 documents: a loan agreement for the full amount, a memorandum of understanding on macro-financial assistance, and amendments to the agreement under the “Ukraine Facility”. To receive defense funds, Ukraine must also open a special bank account with the Deutsche Bundesbank.
Earlier, Ukrainian President Volodymyr Zelensky spoke to journalists and outlined the situation with EU funding , weapons supplies, and responses to Russian attacks.
As a reminder, the European Commission expects that the first funds under the new €90 billion loan package for Ukraine may arrive by the end of the second quarter of 2026.
By the way, the media reported that the new, 20th package of sanctions by the European Union will not contain a complete ban on the provision of maritime services to Russian vessels transporting oil and petroleum products.
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