European Union member states have agreed to cap the price of Russian oil at $60 per barrel, in line with the G7 proposal, European diplomats told the dpa agency.
The agreement came after Poland consented to the European Union’s deal to limit the price of Russian oil to $60 per barrel, allowing the EU to proceed with the formal approval of the agreement over the weekend, Polish ambassador to the EU Andrzej Sados said on Friday.
The goal of the European Union, specifically the G7 member states, is to allow oil supply while reducing Russia’s ability to finance the war in Ukraine by capping oil prices. They also aim to avoid a global spike in oil prices. This sanction would prohibit insurance and maritime shipping services for Russian crude oil unless sold at or below the agreed price level ($60 per barrel), according to the Financial Times.
Poland believed that the sanction would be ineffective as it is too close to the price Russia already has in the market, meaning Russia could simply continue selling oil as usual, Bloomberg reports. Brent crude oil, the Financial Times notes, is currently trading at around $84 per barrel, but the value of Russian oil has fallen, with its main grade Urals trading at around $66 per barrel. Therefore, Poland demanded a much lower price, which they deemed necessary to reduce Russian oil sales revenues.
