The European Union gave final approval on Thursday to a €90 billion loan for Ukraine, the largest single financial commitment to the country since Russia’s full-scale invasion began in 2022. The package had been blocked for two months by Hungary and Slovakia.

Why it matters: The loan secures Ukraine’s military and economic funding through 2027 and signals that the EU, not the United States, is now the primary Western financial backer of Kyiv’s war effort.

What broke the deadlock

Hungary had vetoed the package since February over halted Russian oil deliveries through the Druzhba pipeline that crosses Ukraine. Slovakia joined the blockade for the same reason.

Two developments unlocked the vote. First, oil began flowing again through the pipeline. Second, Hungarian voters defeated Viktor Orban’s Fidesz party in the country’s 13 April election. Incoming premier Peter Magyar has pledged to rebuild Hungary’s ties with Brussels and NATO. EU ambassadors gave preliminary agreement on Wednesday, and the Council finalised the loan on Thursday.

Where the money goes

The package splits into two streams: €60 billion for defence industrial capacity and €30 billion for Ukraine’s general budgetary needs. For 2026, Brussels intends to disburse €45 billion — €28.3 billion for military support and €16.7 billion for financial assistance. The European Commission said the first payment will be made “as soon as possible” once legal and technical documents are finalised.

New sanctions alongside the loan

The EU simultaneously approved a new round of sanctions against Russia. More than 40 ships believed to be part of Russia’s shadow fleet transporting oil were targeted, along with several Russian banks. A ban was imposed on Europeans using Russian cryptocurrency platforms.

What happens next

Ukrainian President Volodymyr Zelenskyy thanked European partners and said his government would work to ensure the funds arrive quickly. The loan’s conditions require Ukraine to meet reform benchmarks on governance and anti-corruption measures, which the European Commission will monitor through quarterly reviews.