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Drudge Retort: The Other Side of the News
Sunday, December 04, 2022

The European Union has reached a deal for a $60-per-barrel price cap on seaborne Russian oil, aimed at significantly reducing Moscow's income and President Vladimir Putin's ability to continue to finance the war in Ukraine.

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Another view...

Ukraine war: G7 and allies approve cap on price of Russian oil
www.bbc.co.uk

...The G7 group of countries and its allies have officially approved a cap on the price of Russian oil.

In a joint statement, the G7 and Australia said the price cap would come into force on 5 December or "very soon thereafter".

It comes after the European Union agreed on the price cap after persuading Poland to back it.

The plan, which stops countries paying more than $60 (57; 48) a barrel, needed the agreement of all EU states.

Poland announced its support on Friday after being reassured the cap would be kept at 5% lower than the market rate.

A price cap was put forward by the G7 group of nations in September and aims to stop Moscow profiting from oil exports while avoiding a price spike.

It had been reported that the EU wanted to set the cap at $65-70 but this was rejected by Poland, Lithuania and Estonia as too high.

Warsaw had wanted the value to be as low as possible and had held out while it examined an adjustment mechanism which would keep the cap below the market rate as the price of oil changed.

On Friday, Russian Urals crude was trading at $64 a barrel.

The decision to impose a price cap was taken to "prevent Russia from profiting from its war of aggression against Ukraine," the joint statement read.

It said the move aims to "support stability in global energy markets and to minimise negative economic spillovers of Russia's war of aggression, especially on low-and middle-income countries, who have felt the impacts of Putin's war disproportionately".

The agreement of a price cap comes just days before an EU-wide ban on Russian crude oil imported by sea comes into force, also on 5 December.

The price cap - which is meant to affect oil exports worldwide - is meant to complement that.

Countries that sign up to the G7-led policy will only be permitted to purchase oil and petroleum products transported via sea that are sold at or below the price cap.

Ukraine's western allies plan to deny insurance to tankers delivering Russian oil to countries that do not stick to the price cap. This will make it hard for Russia to sell oil above that price.

G7 finance ministers said in September that their plan to limit the price of Russian crude would reduce Moscow's oil revenues and its ability to "fund its war of aggression".

White House National Security Council spokesman John Kirby welcomed the agreement of an EU price cap on Friday, saying it would slow Russian President Vladimir Putin's "war machine".

Russia denounced the scheme, saying it would not supply those countries which enforced a price cap....



#1 | Posted by LampLighter at 2022-12-02 07:28 PM | Reply

"However, the chair of the Russian lower house's foreign affairs committee told state news agency TASS that the bloc was jeopardising its own energy security.

It was also violating the laws of the market, Leonid Slutsky said"

What a crock

#2 | Posted by lfthndthrds at 2022-12-05 05:55 AM | Reply

Ukraine says it's not enough, Russia says it's too much. Must have been the right call.

#3 | Posted by REDIAL at 2022-12-05 12:52 PM | Reply

What happened to "free markets"? This is heresy, I tell you, it's Heresy. The West is renouncing It's Own Values to hurt Russia.

This will Not Stand.

#4 | Posted by Effeteposer at 2022-12-05 07:26 PM | Reply

" This is heresy, I tell you, it's Heresy. "

I love the smell of Russian desperation in the (Russian) morning.

Smells like...victory.

#5 | Posted by Danforth at 2022-12-05 07:34 PM | Reply

What happened to "free markets"?

OPEC happened.

"The formation of OPEC marked a turning point toward national sovereignty over natural resources" en.wikipedia.org

Someday a Republican will be able to explain to me why they don't support sovereignty over natural resources beyond saying "But... Venezuela!!!" Like we have no choice but to be corrupt.

#6 | Posted by snoofy at 2022-12-05 07:35 PM | Reply

"Gazprom happened" is perhaps a better answer...

#7 | Posted by snoofy at 2022-12-05 07:37 PM | Reply

@#4 ... What happened to "free markets"? This is heresy, I tell you, it's Heresy. The West is renouncing It's Own Values to hurt Russia. ...

Huh?

There is no "free market" in crude oil. Just ask Pres Biden as he had to give in to the Crown Prince of Saudi Arabia i order to keep the oil coming to the US.

Your alias seems to be saying the the EU cannot say that they do not want to pay more than a certain price for the oil they buy. Correct?

And if the sellers do not agree to that price cap, they are the sellers and they can say, no deal. Correct?

Well, that seems to be what is happening.

The EU has set a price cap, and Pres Putin has said that he won't sell below that price cap.

The "free markets" aspect of this that your alias and its talking points seem to ignore, OK overlook, is that Pres Putin has a market for his oil in Asia, apparently regardless of price.

So, your hero may be saved in this skirmish after all...

#8 | Posted by LampLighter at 2022-12-05 07:50 PM | Reply

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