The Guardian reports: “The EU and the UK have agreed to lower the price cap on Russian oil in a move to further clamp down on the Kremlin’s ability to continue war in Ukraine.
The EU has agreed to lower the cap on seaborne oil exports to $47.60 from $60 a barrel as part of what its foreign policy chief, Kaja Kallas, called “one of [the] strongest sanctions packages against Russia to date”.
In addition, the Guardian writes that “the package includes restrictions on Russian pipelines and banks, as well as tech exports to the country.
EU Foreign Policy Head Kallas said: “We are putting more pressure on Russia’s military industry, Chinese banks that enables sanctions evasion, and blocking tech exports used in drones.”
Indeed, it is the 18th EU sanctions packages against Russia. The EU, in particular, sanctions the Nord Stream pipelines, or what remains after the bomb attack. This will make it impossible to operate the ruins of the pipelines or ever transport and sell Russia gas through the pipelines.
The oil price cap at USD 47 must be seen in the context of the oil markets, the summer months and the economic outlook.
The oil price is currently slightly above USD 60, for this reason the existing cap at USD 60 has no real sanction impact. The market predictions are that prices continue to fall over summer and may not rise in the Winter months due to very sensible reudctions of economic activity in many industrialized nations. In addition, the green agenda of elimination oil may also have a price reaction.
Therefore, the capital at USD 47 may be harsch, but in the context dealable, know that mainly China and India do import directly from Russia and would not need to disclose in full honesty the price paid.
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