Hungary’s decision to block a €90bn EU loan to Ukraine has exposed deepening tensions between Budapest and Kyiv, as Hungarian Prime Minister Viktor Orban escalates a confrontation that analysts say is increasingly tied to domestic politics ahead of a closely contested election due in April.

The dispute has taken an unusually personal tone. Ukrainian President Volodymyr Zelensky has accused the Hungarian leader of acting as Moscow’s “Trojan horse” inside the EU, while Orban has threatened to “use force” to reopen a Russian oil pipeline crossing Ukrainian territory that supplies much of Hungary’s energy needs that has been closed since a drone strike in January. Zelensky responded with a thinly veiled warning that the Hungarian prime minister might receive “a call” from the Ukrainian military. The European Commission (EC) executive condemned Zelenskiy for making “inappropriate” language and Zelenskiy was forced to apologise publicly.

“Why is all this happening? Why now? And where will it end?” asked veteran journalist Julius Strass, who has been following the deterioration in relations between the two neighbours.

The latest episode began with a dramatic security operation in Hungary that government officials quickly publicised online. Footage showed heavily armed counter-terror officers arresting men from a convoy transporting large quantities of cash and gold bullion. The suspects, however, turned out to be employees of a Ukrainian state bank.

“It looked like a raid on organised crime,” Strass said. “But in fact it was the latest salvo in a growing conflict between Budapest and Kyiv.”

Relations between the two countries have deteriorated steadily since Orban returned to power in 2010. “The animus between the two countries is built on two central pillars,” Strass said.

The first concerns Hungary’s ethnic minority in western Ukraine, estimated at between 60,000 and 100,000 people who found themselves outside Hungary’s borders after the 1920 Treaty of Trianon. Budapest frequently claims the minority faces discrimination. “To hear it from Budapest this minority has been persecuted and abused,” Strass said, adding that his own visits to the region suggested they retain “extensive, though not perfect, language and cultural rights.”

The second pillar is geopolitical. Orban’s increasingly nationalist government has cultivated closer ties with Moscow at the same time as it has clashed repeatedly with Brussels. “He has sidled up to Moscow, which is unconcerned by his democratic backsliding, and established close political, economic and, according to some, intelligence ties,” Strass said in his Back from the Front substack blog.

The tensions have sharpened ahead of Hungary’s April 12 election, with polls suggesting Orban trails opposition challenger Péter Magyar by as much as 10–20 percentage points. “Orban had already decided that the focus of his election campaign would be to play ‘the Ukraine card’,” Strass said, describing a narrative that claims support for Kyiv could drag Hungary into war with Russia.

The messaging has been reinforced by an aggressive propaganda campaign. Anti-Zelensky posters have appeared across the country, while online videos portray the Ukrainian leader as a western puppet. “Most Hungarians groaned at such crude tactics,” Strass said, though he added that the narrative has begun to resonate with some voters.

The confrontation escalated further after Russian strikes damaged the Druzhba pipeline running through Ukraine, which supplies oil to Hungary and Slovakia. Kyiv closed the line for repairs, prompting accusations from Budapest that Ukraine was dragging its feet. “Ukraine responded that it had greater priorities than mending a pipeline that took oil from one of its enemies — Russia — to another — Hungary,” Strass said.

Orban responded by blocking the EU’s €90bn financial package for Kyiv and warning Hungary could reopen the pipeline “by force”.

With weeks to go before the election, analysts fear tensions may escalate further. Some reports suggest Moscow has sent social media specialists to Budapest to assist Orban’s campaign. “Orban is Russia’s biggest foreign policy success in Europe,” a Budapest-based analyst told Strass. “They’re not going to let him go easily.”

Meanwhile, Ukraine faces growing financial pressure as the war drags on. The Ukrainian bankers detained in Hungary have since been released, though the gold and cash they were carrying remain in Hungarian custody.

“Nobody expects an early end to this increasingly bitter fight,” Strass said.

Julius Strass is a veteran foreign and war correspondent writing on Ukraine, Russia, the Middle East, eastern Europe, the Balkans, Trump 2.0, and where the world is going. See “Back from the Front” content here.