EU sets Russian oil cap at $60 a barrel
The European Union has agreed to cap Russian oil prices at $60 a barrel after days of negotiation, hoping to limit revenue for its war on Ukraine. The announcement from the G7 also bans all seaborne Russian oil imports starting on Monday, NPR reports.
The measures are to limit Russia's profits without cutting off supply altogether, explains The Associated Press. Russia has warned that these measures will drive up prices and further place stress on the energy market, however, analysts had said that the cap may actually not be low enough and may not impact the country much. "Up front, the cap is not a satisfying number," commented Simone Tagliapietra, an energy policy expert at the Bruegel think tank. She argued the measure could keep Russia from profiting if prices go up.
The cap will also apply outside the EU, essentially locking the price at $60 which is slightly lower than competitors. However, if the cargos come through a country not enforcing the cap, then the cap won't apply, the Times continues. Russia has also said that it will not observe the cap and will not deliver oil to countries that do, but it will still be "more costly, time-consuming and cumbersome" to avoid the restrictions, according to Maria Shagina from the International Institute for Strategic Studies in Berlin. The cap will also be reviewed regularly to maintain its level at least 5 percent below market value for Russian oil.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
"What policymakers are trying to do is cut the world's largest oil exporter out of the market to a large degree," explains Ben Cahill at the Center for Strategic and International Studies.
Create an account with the same email registered to your subscription to unlock access.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Devika Rao has worked as a staff writer at The Week since 2022, covering science, the environment, climate and business. She previously worked as a policy associate for a nonprofit organization advocating for environmental action from a business perspective.
-
Russia rattles nuclear saber, orders tactical nuke drills
Speed Read President Vladimir Putin has ordered Russian military to hold nuclear weapons drills in response to Western "threats"
By Peter Weber, The Week US Published
-
Is Europe ready to come to its own defense?
Today's Big Question 'There is a risk our Europe could die'
By Joel Mathis, The Week US Published
-
'Can we — the people who have bought so much already — really keep buying more?'
Instant Opinion Opinion, comment and editorials of the day
By Harold Maass, The Week US Published
-
Chechnya in jeopardy: what would death of Ramzan Kadyrov mean for Putin?
Today's Big Question Strongman leader is 'terminally ill', stoking fears of armed conflict in the North Caucasus
By Elliott Goat, The Week UK Published
-
Russia gains as Ukraine awaits US aid
Speed Read Ukrainian forces have retreated from several villages as the situation at the front line worsens
By Peter Weber, The Week US Published
-
Ukraine using covert US long-range missiles
Speed Read The weapons are part of a $1 billion Ukraine aid package
By Justin Klawans, The Week US Published
-
'Make legal immigration a more plausible option'
Instant Opinion Opinion, comment and editorials of the day
By Harold Maass, The Week US Published
-
Ukraine cheers House approval of military aid
Speed Read Following a lengthy struggle, the House has approved $95 billion in aid for Ukraine and Israel
By Peter Weber, The Week US Published