February 21, 2023 10:35 GMT
Estonia Call for Lower Russian Oil Price Cap
The EU should lower its price cap on Russian crude to 30$/bbl and limit the price of Russian LNG according to Estonian Foreign Minister Urmas Reinsalu.
- He said the 60$/bbl price cap is “far too high” adding that “Russia gets billions from that business.”
- The combined measures would create a “holistic approach to pressure Russia” in the coming weeks.
- The Urals discount to Brent is approximately 30$/bbl. The average price of Urals crude was 50.51$/bbl between 15 Jan and 14 Feb according to the Russian Finance Ministry last week.
- EU sanctions took effect in December to cap Russian crude exports at 60$/bbl. The price cap limits the availability of western shipping and insurance services to cargoes bought below the 60$/bbl level. The EU has committed to review the limit every two months and to set future caps at least 5% below average market rates.
- EU still imports LNG from Russia despite dramatically reducing pipeline gas flows with only the Baltic states and the UK implementing a ban on Russian LNG imports.