Russian President Vladimir Putin said during a visit to Budapest on February 17 that the state firm Gazprom is ready to ship natural gas to Hungary after an existing agreement expires in 2015.
Putin made the remarks during his first bilateral trip to a European Union country since ceremonies last June marking the 70th anniversary of the Allied D-Day invasion in World War II.
Thousands of Hungarians protested Putin's visit, calling on Hungarian Prime Minister Viktor Orban to stop what they called the "Putinization" of Hungary.
But after talks with Putin in Budapest on February 17, Orban said "Hungary needs Russia" for "energy sources" and to export "Hungarian-made products."
Orban is seeking to negotiate a flexible long-term natural gas supply agreement with Russia beyond Hungary's current agreement, which expires later this year.
Orban, who gained prominence in the late 1980s with a strong anti-Soviet stance as a communist student leader, is now considered one of Putin's closest European allies.
Orban's pro-Russian stance has added to his image problem in the West, after he said last summer that he envisaged Hungary as an "illiberal democracy" modeled on states like Russia and Turkey, even as he cracked down on some civil rights groups.
Orban wants to negotiate a flexible long-term natural gas supply agreement with Russia because the country's current agreement with Russia is due to expire in 2015.
Putin adviser Yury Ushakov said the two will discuss Russian gas supplies to Hungary.
Putin was expected to try to pressure Orban to stall further European sanctions against Russia over its annexation of Crimea and support for pro-Russian separatists in eastern Ukraine.
In December, Russia scrapped the $40 billion South Stream pipeline project, which was designed to supply gas to southern Europe without crossing Ukraine, citing EU objections.
Hungary had firmly backed the South Stream project.
During a visit to Moscow last year, Orban signed a 10 billion-euro ($12 billion) loan deal with Russia to expand Hungary's only nuclear plant, located in Paks, some 130 kilometers south of Budapest.
Putin's trip to Hungary comes amid the ongoing conflict in eastern Ukraine between government troops and Russia-backed separatists.
Hungary supported the European Union sanctions on Russia, but has been vocal about their negative impact.
With reporting by Reuters, AP, AFP, and Interfax