Several G20 countries say ready to implement Russian oil price cap: EU
2 Min Read
A senior EU official says that countries not officially part of the price cap decision have expressed readiness to work with it.
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An oil tanker is moored at the Sheskharis complex, part of Chernomortransneft JSC, a subsidiary of Transneft PJSC, in Novorossiysk, Russia, Tuesday, Oct. 11, 2022, one of the largest facilities for oil and petroleum products in southern Russia (AP Photo, File)
A number of G20 countries, that were not part of the formal price cap on the Russian oil decision, have expressed their willingness to cooperate and work towards implementing it, a senior EU official told journalists in Brussels.
On Friday, the G7 nations and Australia issued a statement saying that had come to an agreement on the maximum price cap of Russian crude oil: $60 per barrel, a decision which will come into effect on December 5.
The price cap developed by the US-led international coalition will be implemented on February 5, 2023, and includes a price review mechanism that will keep the price cap at 5% below the market value.
Read more: OPEC+ may further cut oil production following Russian price cap
The official added that the EU received "positive signals" from several countries that will informally join the price cap imposed on Russian seaborne oil and implement the decision without being an official part of it.
As a result of the price cap decision, companies would be prohibited from providing shipping and insurance, brokering, and financial assistance, which facilitates the transportation of Russian oil unless it sells below the agreed threshold, which (in the case that Russia sells at price cap) would theoretically enable countries to profit on the difference between Russia's oil price and world market prices.
Read more: Putin warns 'no gas, no oil' to if prices capped
The EU official also mentioned that since the EU will be providing significant financial, transportation, and brokering services on non-Russian oil shipments, this brought a sense of assurance to countries not formally within the framework to take part in implementing it.
Read more: Buying Russian oil above price cap to result in sanctions: US Treasury
Each EU country will be responsible for implementing the decision on its own and reporting back to the European Commission, noting that changes to the price cap will need to pass unanimously by all member states, he added.
