Negotiations between EU member states on a Russian oil-price cap proposal became “bogged down” on Wednesday evening, Bloomberg has reported, adding that the bloc’s members remain “split” over the cap level.
A price cap of $65 a barrel reportedly proposed by Brussels is thought to have failed to gain support both from those advocating a tougher stance and those preferring more leeway in dealing with Moscow. The proposal was rejected by Poland and the Baltic States, which called it “too generous” for Russia, Bloomberg said, adding that nations with major shipping industries like Greece or Malta insisted the cap should not be below $70.
Earlier, some media reports suggested that the price limit under consideration reportedly ranged between $40 and $60. On Wednesday Bloomberg said, citing its sources, that the EU was discussing a cap amounting to between $65 and $70 a barrel.
The talks are now expected to continue into the night and could be resumed on Thursday, according to the outlet. Proposed by the Group of Seven (G7), the oil-price cap was previously expected to be confirmed as early as Wednesday in the event of its support by all EU member states.
EU energy ministers are also to discuss measures to contain gas prices at a separate meeting on Thursday, Bloomberg said.
The development came after Brussels already watered down the proposed cap by weakening some shipping provisions and delaying the measure’s future implementation. Under the plan seen by Bloomberg, the grace period would apply to crude loaded before December 5, when oil-related sanctions come into effect, and unloaded by January 19.
Bloomberg, however, believes that the price cap would hardly affect Russia’s oil trade even if its existing draft is adopted. “Russian oil currently trades at a significant discount compared to Brent, around $65 per barrel,” Simone Tagliapietra, a senior fellow at the Bruegel think tank in Brussels, told Bloomberg. “Should the G-7 price cap for Russian oil be set at a similar level, it wouldn’t do much harm to Russia,” he added.