Russia addressed EU's oil price cap without consulting OPEC+: Kremlin
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Kremlin spokesperson Dmitry Peskov tells reporters that there “were no” direct contacts with the OPEC+ before the decision.
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Russia responded to the EU's oil price cap without consulting OPEC+
Russian President Vladimir Putin did not consult with OPEC+ before signing the decree on measures in response to the EU’s price cap on Russian oil, Kremlin spokesperson Dmitry Peskov told reporters on Wednesday.
“There were mainly, of course, internal [consultations] in Russia. This is a sovereign right of Russia to respond to such illegitimate, absolutely absurd measures – this so-called price ceiling. Thus, this was preceded by the expert analysis inside Russia,” Peskov said, adding that there “were no” direct contacts with the OPEC+ before the decision.
On Tuesday, Putin signed a decree to prohibit the sale of Russian oil and its derivates to countries that imposed the price cap. The decree targets contracts that include a direct or indirect price cap clause.
The ban will go into force starting February 1 of 2023 and will remain valid till June 1, which is (end-date) susceptible to change by the Cabinet.
The European Union set a limit on the price of Russian crude oil at $60 per barrel on December 5. Every two months, the cap will be examined to ensure that it is still 5% below the baseline set by the International Energy Agency.
Additionally, the G7 countries and Australia have set a $60 per barrel ceiling on Russian oil exports.
Countries and companies that decide not to apply the price cap can still purchase it but cannot do so through Western companies that provide insurance or transport services.
Since the start of the war in Ukraine, Western nations have been seeking methods to reduce Russia's revenue from oil and gas exports. The G7 finance ministers asked all countries to endorse the idea in September by confirming their determination to set a price ceiling on Russian oil.
The European Union introduced the eighth package of sanctions against Moscow in October, which included a legislative basis for setting a price cap for maritime shipments of Russian refined products starting from February 5, 2023.
In response to the West's decision to enact the price ceiling, Russian Deputy Prime Minister Alexander Novak stated that Moscow would not accept it. Only consumers who follow the rules of the market will be accepted by Russia, Novak continued.
