Page 12 - FSUOGM Week 05 2023

FSUOGM POLICY FSUOGM

EU and G7 agree on Russian

petroleum product price caps

RUSSIA THE EU and G7 agreed on February 4 to impose The EU aims to have a tenth package of
two separate caps on different Russian petro- sanctions against Russia introduced by the first
This comes three leum products based on their market value, in anniversary of Moscow launching its invasion
months after the cap on an effort to further strangle Moscow’s revenue of Ukraine on February 24, 2022, von der Leyen
Russian crude oil. stream from oil and gas exports. said.
As proposed by the European Commission, The latest measures allow for a 55-day wind-
the European Council and the G7 have agreed down period during which seaborne Russian
to introduce a price cap of $100 per barrel for petroleum products purchased above the price
premium Russian oil products such as diesel, cap can still be received, provided that they were
kerosene and gasoline, and a $45 per barrel cap loaded onto a vessel prior to February 5 and
for discounted products such as fuel oil and unloaded at the final port of destination prior to
naphtha. EU and G7-based companies will April 1, 2023.
be barred from providing transport services “The price caps for petroleum products and
for the sale of Russian petroleum products, or crude oil will be continually monitored to ensure
any technical assistance, brokering services, their effectiveness and impact,” the European
financing or financial assistance for the deliv- Commission said. “The price caps themselves
ery of those cargoes, unless the price caps are will be reviewed and adjusted as appropriate.”
complied with. The European Council said it would review
The caps came into force on February 5, three the price cap mechanism for Russian crude oil
months after a similar cap of $60 per barrel was in mid-March, with reviews due to take place
introduced on Russian crude oil exports. every two months after that. This was a win for
“We are making Putin pay for his atrocious more hawkish EU states such as Poland and the
war. Russia is paying a heavy price, as our sanc- Baltics, which had demanded the two-month
tions are eroding its economy, throwing it back review.
by a generation,” European Commission Presi- The caps on Russian fuel exports coincide
dent Ursula von der Leyen said in a statement. with the introduction of an embargo by the EU
“Today, we are turning up the pressure further of those supplies. Therefore the caps are aimed at
by introducing additional price caps on Russian depriving Moscow of revenues from other mar-
petroleum products.” kets such as India and China. ™

P12 www. NEWSBASE .com Week 06 07•February•2023