Russian petroleum: EU agrees on price cap

Sat 4th Feb, 2023

Image by TalpaEU member states have agreed on price caps for Russian petroleum products. "EU ambassadors today approved the price caps for petroleum products - ahead of a final adoption by the European Council," the Swedish EU presidency said on the online service Twitter on Friday.

According to EU diplomats, the price caps are $100 per barrel (159 liters) for fuels such as diesel or kerosene and $45 per barrel for products such as heating oil. A little later, the G7 and Australia said they had also agreed on a price cap. Accordingly, the limits correspond to those of the EU.

The price caps apply to processed Russian oil products such as diesel and heating oil transported on EU ships and are due to come into force on Sunday. The agreed caps were in line with a Commission proposal and are intended to limit Russia's revenues and thus its ability to finance the war in Ukraine.

The EU, the seven major industrialized nations (G7) and Australia had already imposed a cap on Russian crude oil of $60 per barrel in early December. They are using shipments as leverage: companies from these countries are prohibited from transporting Russian oil and, as of Sunday, oil products, or insuring tankers carrying products at prices above the agreed limits.

According to an assessment by EU Commission President Ursula von der Leyen on Thursday, the existing price cap on Russian oil is already costing Moscow around 160 million euros a day.

On Friday, she said the EU was preparing a new sanctions package against Russia - the tenth since the war began nearly a year ago. "We must continue to deprive Russia of the means it needs to wage war against Ukraine," von der Leyen said.

Image by Talpa


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