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Russian crude oil now trading above EU / G7 Price Cap

News & Insights 14 July 2023

The Russian oil Price Cap has been in place since 5 December 2022.

Russian crude oil now trading above EU / G7 Price Cap

Initial feedback from the EU/G7 is that it has been successful at restricting Russian income derived from its oil sales - Read Here. However increased attention is now focussed on preventing circumvention.

The EU/G7 Group of countries monitor international oil price trading indices. Such indices show that the price of recorded sales of East Siberia Pacific Oil or “ESPO” shipped from the Russian port of Kozmino since the introduction of the Russian Oil Price Cap has consistently been above the capped price of $60.00. Read Papers Here.

Further recent press reports are now highlighting that Russian Urals crude breached the $60 per barrel mark in the second week of July 2023, having up till that point remained largely below the price gap imposed by the G7.

Whilst indices are by their nature only ever an average of reported sales Members should, in addition to their being provided with a credible voyage attestation, exercise enhanced levels of due diligence when contracting to lift Russian crude oil cargoes where the published trading prices exceed the Price Cap. Given the well-publicised concerns about the recorded sale price of ESPO cargoes from Kozmino and now Urals Members should also expect delays from their financial and technical service providers (such as banks and insurers) who will need to be satisfied that the individual shipment was sold at a price below the Russian Oil Price Cap before providing their services.

The original article is shared on the NorthStandard site – Click Here to View 

Categories: Sanctions, Ukraine / Russia

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