The EU has not agreed on a price limit for oil from the Russian Federation: Poland gives a maximum of $ 30 per barrel, – media

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The EU has not agreed on a price limit for oil from the Russian Federation: Poland gives a maximum of $30 per barrel, – media

The G7 proposes to set a price limit of $65-70 per barrel. Some countries believe that this is not enough – Russia will still receive super profits, because the cost of production of 1 barrel does not exceed $ 20.

scheme of the G7 countries. The talks will continue on November 24 or 25, European diplomats said in a commentary to Reuters.

Representatives of 27 EU countries met in Brussels on November 23 to discuss the proposal of the G7 to set the price limit for oil from the Russian Federation at 65-70 dollars per barrel. These figures turned out to be too low for some and high for others, sources say.

“There are disagreements on the level of the marginal price, it is necessary to act on a bilateral basis,” the diplomat commented.

Poland, Lithuania and Estonia believe that the price of 65-70 dollars per barrel will allow Russia to receive too high revenues, since the cost of oil production is about 20 dollars per barrel.

Cyprus, Greece and Malta, receiving revenues from shipping, will lose more than others if Russian oil tankers stop carrying oil. They are demanding compensation for loss of business income or more time to adapt, writes Reuters.

“Poland says it cannot rise above $30 per barrel. Cyprus demands compensation. Greece needs more time,” he explained. second diplomat.

Most EU countries, led by G7 members France and Germany, support price caps, but are worried about enforcing them, according to the interlocutors.

Restricting oil prices from Russia: how does the scheme work?

About 70-85% of crude oil from Russia is delivered by tankers, not pipelines, Reuters notes.

The idea behind the price cap is to prevent shipping and insurance companies from handling Russian oil worldwide if it is sold at a price that exceeds the limits set by the G7 and its allies.

Since the world's main shipping and insurance companies are located in the G7 countries, the price ceiling will affect the sale of Russian oil.

The European Union has not agreed on a price limit for oil from Russia: Poland gives a maximum of $30 per barrel, – media

The European Union did not agree on a price limit for oil from the Russian Federation: Poland gives a maximum of $30 per barrel, – media

Cost of production is estimated at about $20 per barrel, so the price cap will still allow Russia to profitably sell oil and thus prevent a shortage of supply on the world market.

Russian Urals oil, according to Reuters, is trading in a range of about $68 per barrel.< /p>

The G7 includes the United States, Great Britain, Germany, Italy, Canada, France and Japan. Countries should set a price limit on Russian oil exports by sea on December 5.

Ukraine will increase the price of Russian oil transit from January 1, 2023 due to constant rocket attacks by the Russian Armed Forces on energy infrastructure.

Bloomberg previously wrote about the creation of a “shadow fleet” to export oil from Russia under sanctions.