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EU agreed to limit Russian seaborne oil price by US $60

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EU agreed to limit Russian seaborne oil price by US $60

Date: December 8, 2022 Source: logistics chain
After weeks of repeated negotiations and the insistence of some countries at the last moment, the EU confirmed that an agreement had been reached to set a price ceiling for Russian oil. This is a key step against the Russian ban on seaborne oil imports, which will take effect on December 5. This move is known as the determination of the West to impose sanctions on Russia in retaliation for the war in Ukraine, but how it will affect the shipping industry remains questionable.
The Czech Republic, the rotating presidency of the Council of European Union, which will expire this month, released the first message on Twitter, confirming that the two sides have reached an agreement. The ambassadors have just reached an agreement on the price ceiling of Russian seaborne oil. " The statement did not confirm the widely reported $60 per barrel ceiling, but said: "The written procedure is followed and the decision will take effect after being published in the official journal."
Gertrude, President of the European Commission? Gertrud von der Leyen also released a short video statement, praising the agreement as a sign of the EU's determination to strengthen the effect of sanctions. She said that the agreement will reduce Russia's revenue while stabilizing the global energy market. She said that a key factor is to ensure that emerging and developing countries can continue to obtain oil at a limited price.
This price has raised many questions. Analysts pointed out that although this price was significantly lower than the current price of the global benchmark Brent crude oil, it was actually higher than the current price of Russian crude oil. It is reported that some countries, including Poland and the Baltic States, which opposed the negotiations, advocated raising the oil price to ensure that Russia would not cut off the key supply of oil, especially to developing countries, thus creating a new shock wave in the global energy market. Others said that the $60 ceiling was basically a political move with little practical impact. However, Von Delain pointed out in her comments that the upper limit can be adjusted according to the development of the market.
Russia has previously said that it may not sell natural gas to countries that comply with the price ceiling. However, Sergei Lavrov, the Russian Foreign Minister, said in his comments that the price ceiling level was irrelevant.
It is unclear how the quota will be implemented and what role shipping companies will play in the plan. Everyone is paying close attention to the release of official procedures, and everything will be finalized.
However, analysts believe that the shipping industry has been quietly turning to prepare for sanctions and price caps. The transport cost of Russian crude oil has soared recently due to concerns about the sanctions ceiling and its impact on the industry. At the same time, however, people speculate that the recent record crude oil tanker prices may reflect that the industry is quietly adjusting its fleet to control the upper limit of capacity. For example, the Iranian monitoring organization UANI reported yesterday that since the invasion of Ukraine in February, "31 ships have been found to have changed from helping Tehran export Iranian oil to helping Moscow transport Russian oil or petroleum products". The non-governmental organization emphasized their so-called "conversion list", saying that "UANI first predicted that Russia would turn to the 'ghost fleet' in May 2022 to keep crude oil flowing to Chinese partners. Since then, the number of oil tankers making this transition has increased."
UANI compares it with Iran's handling of oil trade sanctions. In an analysis report released on December 1, they said that no less than 280 ships had participated in the transfer aimed at circumventing the sanctions on Iranian oil. At present, they point out that more than one third of the ships are registered in Panama, but they point out that the "flag jumping" report shows that more than 20 registered ships have participated in the trade.
The preliminary agreement reached by EU ambassadors needs to be finalized and is scheduled to be adopted on Monday. The Group of Seven also needs to approve the next step to expand restrictions on Russian oil. The Group of Seven (g7) has promised to stop importing Russian oil before the beginning of 2023. As the Ukraine war enters its first year, the European Union (EU) is also preparing to expand its ban on Russian oil products in February next year.

Pub Time : 2022-12-08 16:08:06 >> News list
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