(Finance) – The European Union has found aagreement on the price cap on oil supplies from Russia by sea to third countries. The agreement, reached by the permanent representatives of the governments to the EU (Coreper), provides for a ceiling of 60 dollars a barrel and follows the general agreements previously decided at the G7 level. There Polandwho was pushing for a lower ceiling, withdrew its objection to the European proposal.
“The EU agreement on the oil price ceiling, coordinated with the G7 and other partners,” said the President of the European Commission Ursula von der Leyen – will significantly reduce Russia’s revenues, help us stabilize global energy prices, benefiting emerging economies around the world, and be time-tunable so we can react to market developments.”
The established threshold will bind in particular shipowners and reinsurance companies on maritime transport on Russian crude oil to third countries, given that, with a few exceptions, the EU had already imposed a ban on imports of crude oil from Russia. In detail the price cap it presents itself as an exception to the ban on financial assistance (including insurance), technical assistance, or intermediation services provided by EU operators in relation to the transport of oil from Russia to third countries. At the same time, it presents itself as a condition for the entry into force of a parallel prohibition of transport by EU operators of the same oil. On the other hand, the cap does not affect the ban on importing oil by sea into the EU, which has already been established and from 5 December the derogations for the contracts in progress relating to crude oil imports will no longer apply. It doesn’t even affect the ban on importing oil into the EU via pipeline, which, however, is not currently in force: there is only a unilateral commitment by Germany and Poland to interrupt imports by 31 December next and a generic commitment by the Council to reconsider the question.
The United States has welcomed reports that the European Union has reached an agreement on imposing a cap on the price of Russian oil. “We see the news and it is a positive development that – said the White House National Security Council spokesman John Kirby – are reaching an agreement towards a price ceiling”.
“I welcome the political agreement on the Russian oil price cap: capping Moscow’s energy revenues is critical to stopping the Russian war machine,” she said. Estonian Prime Minister Kaja Kallas –. It’s no secret that we wanted a lower price. However this is the best compromise we could get today. I am glad that the partners accepted Estonia’s proposal to review and adjust the price on a regular basis. The agreed condition is that the price ceiling is at least 5% below the average market price of oil. The first price review will take place as early as mid-January.”