Thursday, May 30, 2024

Price cap: “Europe would’ve to live without Russian oil”

Russian officials pushed back as the EU announced it’s imposing a ‘price cap’ on the country’s oil, with one diplomat suggesting Europe will simply have to “live without Russian oil.”

Russia will not recognize a so-called ‘price cap’ on Russian oil which the European Union adopted this week, officials announced Saturday.

“We will not accept this ceiling,” Kremlin spokesman Dmitry Peskov explained Saturday, adding that the Russian government is currently “analyzing” the situation and “will provide further information” on its response after a review process.

On Friday, European Commission President Ursula von der Leyen declared that the EU would be imposing a “global price cap on seaborne oil from Russia” of $60/barrel. Under the scheme, insurers and brokers who service oil tankers which ship Russian fuel exceeding the price limit determined by Brussels would risk being sanctioned.

“The EU agreement on an oil price cap… will reduce Russia’s revenues significantly,” she claimed in a speech on Friday, before insisting that the move would also “help stabilize global energy prices, benefitting emerging economies around the world.”

Despite what they characterized as an effort to manipulate “the basic principles of free markets,” the Russian Embassy in Washington wrote in a statement on Saturday that they are “confident that Russian oil will continue to be in demand.”

But Western economies may not be so lucky, Russian officials suggested.

“Starting from this year Europe will live without Russian oil,” wrote Mikhail Ulyanov, Russia’s Permanent Representative to International Organizations in Vienna. “Moscow has already made it clear that it will NOT supply oil to those countries who support [the] anti-market price cap.”

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