EU reaches agreement on Russian oil products price cap

European Union countries today agreed a cap on the global price of Russian petroleum products before a full import ban on Russian oil products comes into effect from Sunday.

Ambassadors agreed to cap the price of oil products that trade above the price of crude ̵1; including diesel, gasoline and jet fuel – at $100 a barrel, two EU diplomats said. Products trading at a discount to crude will be capped at $45 per barrel.

Swedish Presidency of the Council deal confirmed Friday afternoon, just two days before the European Union banned the import of all Russian oil products.

The EU ban and the G7 price cap are intended to work in tandem. While EU sanctions shut off one of Russia’s most important markets for its fossil fuels, the price cap is intended to allow Russian exports to continue on the global market, protected from oil supply shortages or price shocks. Avoid.

The price caps on petroleum products follow a $60 cap on the price of Russian crude, agreed in December to coincide with a similar EU import ban.

A decision on the cap level was delayed after Poland and the Baltic states pressed for a review of crude oil price caps and a lower price cap on petroleum products. The two diplomats said a deal was reached on the proviso that both sets of price caps would now be subject to review every two months, starting in March 2023.