The European Commission is considering setting a $100 per barrel price cap on premium Russian oil products like diesel and a $45 per barrel cap on discounted products like fuel oil.
As Reuters reports, the proposal was sent on January 26 to EU governments, whose representatives will discuss it at a meeting on January 27. The aim is to reach a deal before the price cap on imported Russian oil products is to come into force on February 5, in line with an agreement by G7 countries.
The price cap on Russian oil products comes after a $60 per barrel cap imposed on Russian crude on December 5th as G7 countries and the 27-nation EU as a whole seek to limit Russia’s revenue from its oil exports without disrupting world supply.
The price caps imposed by the G7 and the EU aim to obstruct Russia’s ability to finance its war in Ukraine.
Both price caps work by banning Western insurance and shipping companies from insuring or carrying cargoes of Russian crude and oil products unless they were bought at or below the set price cap.
The $60 per barrel limit on crude is now up for review as the market price has been just below the cap.
