EU countries today agreed a cap on the global price of Russian petroleum products, ahead of a full import ban on Russian oil products that comes into force on Sunday.
Ambassadors agreed to cap the price of oil products that trade above the price of crude oil — including diesel, gasoline and jet fuel — at $100 per barrel, two EU diplomats said. Products that trade at a discount to crude will be capped at $45 per barrel.
The Swedish presidency of the Council confirmed the deal on Friday afternoon, just two days before the EU bans imports of all Russian oil products.
The EU ban and the G7 price cap are intended to work in tandem. While the EU sanctions close off one of Russia’s most important markets for its fossil fuels, the price caps are intended to permit Russian exports to continue flowing on the global market, avoiding a major oil supply shortage or price shock.
The price caps on petroleum products follow a $60 cap on the price of Russian crude oil, 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 pushed for a downward review of the crude price cap and for lower price caps on petroleum products. A deal was reached on the proviso that both sets of price caps will now be subject to a review every two months, starting in March 2023, two diplomats said.
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