The G7 coalition will maintain a price limit on Russian oil delivered by sea at $60 per barrel, despite rising global oil prices and calls from some countries to lower the price to limit Moscow’s revenues.
Reuters reported this, citing a coalition representative who spoke on condition of anonymity.
According to his words, the G7 and Australia have decided to maintain the upper limit after reviewing the price set at $60 in December over the past few weeks.
This comes after four weeks of rising oil prices, aided by OPEC+’s production cut and a resurgence in demand in China.
On Monday, the market consolidated, with Brent and US crude oil futures holding above $80 per barrel.
Russian oil is being sold at a discount of around $30 to Brent, according to an official.
Coalition representatives have concluded that the upper price limit works to restrict Russian income while maintaining stability in the energy market, but have stated that they will continue to coordinate their actions to ensure effective monitoring and enforcement, added the source.
The coalition is also stepping up efforts to combat evasion of the upper price limit and sanctions imposed on Russia, including the use of deceptive practices to gain access to coalition services for oil sold above the upper limit.
Coalition members plan to develop recommendations to help service providers detect signs of evasion, such as manipulation of vessel tracking or the inability to separate costs for delivery, freight, customs duties, and insurance from the oil itself, said the interlocutor.
The price cap on oil prohibits G7 and European Union companies from providing transportation, insurance, and financing services for Russian oil and petroleum products if they are sold at a price higher than the upper limit.
An official noted that a recent report by the International Energy Agency (IEA) concluded that the “G7 sanctions regime” had been effective, “not restricting global oil and petroleum product supplies, but at the same time limiting Russia’s ability to generate export revenues”.
On Friday, the MEA reported that Russia’s March revenues from oil sales increased by $1 billion on a monthly basis to $12.7 billion, but still remained 43% lower than a year earlier.
Reminder:
The European Commission has informed member states that the price limit of $60 per barrel for Russian oil is proving effective in limiting the Kremlin’s access to oil dollars without disrupting the market, and will remain unchanged for now.