EU considers softer oil cap, adding transition periods: Bloomberg
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The proposed transition period will apply to oil loaded before December 5, 2023, according to media reports.
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A pumping unit sucks oil from the ground near Greensburg, Kan. (AP)
The European Union has proposed adding a 45-day transition time to the date of the implementation of the oil price cap, Bloomberg reported on Tuesday, citing a document.
The proposed transition period will apply to oil loaded before December 5, 2023, when the cap is scheduled to go into effect, and emptied by January 19, 2023, the report added.
The EU also suggested a 90-day transition period in the event that the oil cap price changes, as per the news agency.
According to Bloomberg, which cited people involved with recent conversations, the price ceiling on Russian oil that Western countries seek to implement may be higher than the previously proposed range of $40-$60 per barrel.
The United States and its Group of Seven allies will likely agree soon to cap the price of Russian oil at $60-70 per barrel on Wednesday, The Wall Street Journal reported on Tuesday, citing sources familiar with the matter. It is worth noting that the price of a barrel of Brent Crude is $89.43 at the time of writing.
Later on in the day, the ambassadors of the 27 European Union member states will meet to try and reach a decision regarding the issue at hand.
The decision can only be taken if the EU unanimously votes in favor, and the G7 will be voting in parallel to the 27-nation bloc.
A flashback
Following months of debate, the EU reached last month an agreement to impose a price cap on Russian oil sales to third countries, in an attempt to block Moscow's use of EU-registered vessels for its oil exports, all while excluding pipeline deliveries from the 8th round of sanctions on Russia, Politico Europe reported.
Additionally, Russia pledged to stop exporting its oil to countries that would apply price caps on its oil.
In a notice, the US Treasury Department said that the price cap mechanism on Russian oil implemented by the G7 countries will offer protections for maritime service providers unknowingly involved in cases.
Those who violate the price cap on Russian oil exports will suffer consequences under the domestic law of the jurisdictions enforcing the quota, according to US Deputy Treasury Secretary Wally Adeyemo.
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