The EU governments have agreed, tentatively, to a $60 a
barrel price cap on Russian seaborne oil, according to a Reuters report,
citing an unnamed diplomat.
However, in a compromise to keep Poland and the Baltic
states happier, there will also be an adjustment mechanism to keep the cap at
5% below the market price. Poland had been pushing for a cap as low as $30,
while the shipping states of Malta, Cyprus and Greece had wanted a cap in the
range $65 to $70.
It was not clear whether Poland had or had not agreed to
the deal being put to all EU governments in a written procedure on Friday, just
three days before the cap is due to be implemented. Polish diplomats said on
Thursday that consultation with Warsaw was ongoing.
“The price cap is set at $60 with a provision to keep it
5% below market price for Russian crude, based on IEA figures,” the EU diplomat
said. The reviews of the price cap level would be held every two months.
EU diplomats said that Lithuania and Estonia, which had
backed Poland’s push to set the cap as low as possible, had agreed to the $60
limit with an adjustment mechanism. Russian Urals crude URL-E was trading at
$70.3 a barrel on Thursday afternoon.
The G7 price cap on Russian seaborne crude oil is set to
come into force on December 5th. It will replace a harsher EU
outright ban on buying Russian seaborne crude.
