According to Bloomberg, the European Union is considering temporarily suspending the price cap on Russian oil due to the war in the Middle East. However, a final decision has not yet been made.
Points of attention
- Potential scenarios include keeping the price limit unchanged, suspending automatic increases, or capping any increase in line with the G7 level.
- This decision may be part of the upcoming 21st EU sanctions package set to be agreed upon in early June, reflecting the ongoing geopolitical tensions.
The EU may ease pressure on Russia
Back in 2025, official Brussels introduced a dynamic mechanism that provides for the automatic setting of a price limit every six months at a level that is 15% lower than the average market price for Russian Urals oil.
What is important to understand is that the current price threshold is $44.10 per barrel — it should be reviewed in a few months.
It's no secret that the war in the Middle East has caused oil prices to skyrocket. In fact, it's said that the price of Russian Urals could reach as high as $65 at the next review.
What is important to understand is that the freeze will make it possible to maintain the price limit at the current level.
Other options under consideration include suspending the dynamic and automatic increase until the end of the year given the exceptional circumstances in the Middle East, or capping any increase at $60 in line with the G7 level, the sources said.
According to insiders, this decision may become part of the 21st EU sanctions package, which will be agreed upon in early June.
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