EU Considers Freezing Russian Oil Price Cap Due To War With Iran Bloomberg

(MENAFN- UkrinForm) According to Ukrinform, Bloomberg stated this in an article, citing informed sources.

Last year, the EU introduced a dynamic mechanism to ensure that the price cap would be automatically set every six months at 15% below the average market price of Russia's Urals crude oil.

The current price cap is $44.10 per barrel and is due for review later this summer.

Under these restrictions, European companies are prohibited from providing services such as insurance and transportation for oil sold above the established price threshold.

Oil prices have risen sharply as a result of the U.S. and Israeli war with Iran and the effective closure of the Strait of Hormuz.

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According to the sources, the next review of the price cap in July would likely raise the threshold to at least $65 per barrel, exceeding the previous $60-per-barrel cap collectively established by the G7.

The sources added that a "freeze" would keep the price cap at its current level.

Other options under consideration include suspending the dynamic and automatic increase of the cap until the end of the year due to the exceptional circumstances in the Middle East, or limiting any increase to $60 per barrel, matching the G7 level.

As Ukrinform previously reported, in May the European Union criticized the United States' decision to extend an exemption from sanctions on Russian oil sales, warning that the move would only increase Moscow's financial gains since the start of the war involving Iran.

Photo: Office of the President of Ukraine

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