With the world’s top shipping and insurance companies based in the G7 countries, the cap could make it more difficult for Moscow to sell its oil at a higher price.
Russia, the world’s second-biggest oil exporter, said on Sunday it would not accept the cap and would not sell oil subject to it, even if it had to cut output.
The sale of oil and gas to Europe has been a major source of Russian hard currency since Soviet geologists found oil and gas in the Siberian swamps in the decades after World War II.
A source who asked not to be named due to the sensitivity of the situation told Reuters that a decree was being prepared to ban Russian companies and traders from interacting with countries and companies that abide by the cap.
In essence, said decree would prohibit the export of oil and oil products to the countries and companies that apply it.
Still, with the price cap set at $60 a barrel, not far below the $67 level URL-E closed on Friday, the EU and the G7 countries hope that Russia will still have an incentive to continue selling oil at that price, although accepting lower benefits.
The EU and the G7 will review the level of the cap every two months, with the first review to be in mid-January.
“This review should take into account (…) the effectiveness of the measure, its application, international adherence and alignment, the potential impact on coalition members and partners and market developments,” the European Commission said. it’s a statement.
The crude price cap will be followed by a similar measure affecting Russian oil products that will take effect on February 5, although the level of that cap has yet to be determined.
Russia will not export oil subject to the Western price cap.
