As nations rush to prevent a politically disastrous update to the price restriction on Russian oil, the European Union has entered the final round of discussions to find an agreement on a new round of penalties against Moscow. In order to stay 15% below the average market price, the cap, which is now set at $44.10 a barrel, must be automatically modified every six months. The date of the next review is July 15.
The revision is likely to push the cap much higher, probably to $58 per barrel, given that Russian oil prices skyrocketed following the closure of the Strait of Hormuz. This would give the Kremlin breathing room at a time when its economy is under increasing strain and Ukraine is gaining momentum on the battlefield. The European Commission has suggested postponing the review until January of the following year in order to maintain the cap at $44.10 a barrel since they find this scenario intolerable.Energy Commissioner Dan Jørgensen told Euronews, “We need to have as strict sanctions as we can, including the price cap.” “We are not in a situation where we are stepping down or in any way loosening our pressure on Russia.” However, three nations with strong maritime services—Malta, Cyprus, and Greece in particular—have questioned the delay.
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