Diplomats have revealed that European Union governments have agreed to cap the price of Russian oil shipped by sea at $60 a barrel.
Reuters said it had seen a document showing the deal would include a mechanism to keep the price of Russian oil 5% below the market level.
The agency also quoted an EU diplomat as saying all EU governments must agree by Friday, adding that Poland has not yet confirmed its support for the deal and is seeking to reduce the price ceiling.
Poland insisted that the limit be as low as possible.
European Union countries have been arguing for days over the details of a price cap aimed at reducing Russia’s revenue from oil sales.
As Russian Ural crude is trading at an already low price, Poland, Lithuania and Estonia have rejected that level as falling short of the main goal of limiting Moscow’s ability to finance its war in Ukraine .
Periodic review
A document from the European Union has shown that the price ceiling will be reviewed in mid-January, and subsequently every two months, to evaluate the progress of the plan and deal with the possible “turbulence” of the oil market that will derive from it.
The document says a 45-day “transitional period” will apply to ships carrying Russian-sourced crude that was loaded before December 5 and unloaded at its final destination by January 19, 2023.
Russian Ural crude was trading at around $70 a barrel on Thursday afternoon.
Reuters also quoted a G7 official as saying the group’s countries are very close to agreeing on a price cap for Russian seaborne oil at $60 a barrel, adding that the deal is expected to be completed by next Monday at the latest.
The same official expressed confidence that the price cap would limit Russia’s ability to fight its war against Ukraine.
The official said G7 officials have been in close contact with markets regarding the price cap, and appear to be “very comfortable” with the mechanism, which aims to cap Russia’s oil revenues by maintaining adequate supplies for the global market.
And from December 5/December the application of the Group of Seven price caps to Russian seaborne crude oil begins, replacing the strict ban imposed by the European Union on the purchase of Russian seaborne crude oil, as a means of ensuring the ‘global oil supply because Russia produces 10% of the world’s oil.
