EU officially agrees on level of price caps for Russian petroleum products

On Saturday, 4 February, the European Council decided to set two price caps for petroleum products, which originate in or are exported from Russia.

Source: message of the Council of the EU; European Pravda

Details: The first price cap for petroleum products traded at a discount to crude oil is set at US$45 per barrel, while the second price cap for petroleum products traded at a premium to crude is set at US$100 per barrel.

The level of the cap was established in close cooperation with the Price Cap Coalition and will become applicable as of 5 February 2023. A transitional period of 55 days is foreseen for those vessels carrying Russian petroleum products, which were purchased and loaded onto the vessel prior to 5 February 2023 and unloaded prior to 1 April 2023.

In addition, the Council will revert to review the price cap mechanism for crude oil as of mid-March and the review will occur regularly every two months.

Quote: "In the face of Russia's war of aggression, the EU stands resolutely with Ukraine and its people, and is unwavering in its support of Ukraine's independence, sovereignty and territorial integrity within its internationally recognised borders, as well as of Ukraine’s inherent right of self-defence against the Russian aggression."

Background: On Friday, Swedish Presidency of the Council of the EU reported that permanent representatives of the EU countries agreed on a price cap for Russian petroleum products.

At the same time, Ursula von der Leyen, President of the European Commission, said that the EU and the G7 put a price cap for Russian petroleum products.

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