Home » Russian oil, ready embargo and price cap. There is a risk of higher fuel prices

Russian oil, ready embargo and price cap. There is a risk of higher fuel prices

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Russian oil, ready embargo and price cap.  There is a risk of higher fuel prices

To “make Putin pay the price for his atrocious war”, embargoes and price caps on oil derivatives are triggered. This was said by the president of the European Commission Ursula von der Leyen. The agreement was signed between the 27 EU countries, between the members of the G7 and Australia.

It is a move with two faces: an embargo – already agreed in December – on all refined petroleum products imported from Russia to the EU by sea, and a trap set at between 100 and 45 euros per barrel for exports – again maritime – directed towards third countries. Price caps that will allow shipping companies carrying diesel, kerosene or naphtha of Russian origin to operate in the West only with prices below the expected cap.

However, for third countries, updating the price list of Russian petroleum products will not be immediate: the 27 have decided to grant a transition period of 55 days for contract and transport reasons, especially as regards diesel

The price fork is a further element that adds to the ceiling already approved at the end of 2022 on Russian crude oil and set at 60 dollars a barrel, and to the oil embargo – activated on December 5th – which contemplates the ban on the purchase, import or transfer of crude oil by sea from Russia to the EU.

For the anniversary of the war against Kiev, on 24 February, the EU executive is working with national governments to finalize and rapidly implement a new package of sanctions. It will be the tenth in twelve months.

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In the meantime, however, concerns are being raised about the new probable price increases, as Assoutenti underlines: «A million barrels per day from Russia will decrease, prompting the various countries to obtain supplies of petrol and diesel from other states such as China and the United States, with consequent higher transport costs, without counting the possible speculations linked to the race for hoarding», explains the president Furio Truzzi.

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