Ukrainian President, Volodymyr Zelensky, has proposed that the price for Russian seaborne oil should be capped at between US$30 and US$40 a barrel, lower than the level that Group of Seven (G-7) nations.
US and its allies, as well as the European Union governments are seeking to curb Moscow’s ability to fund the Ukraine war without causing an oil supply shock; they are however split over a G-7 push that the cap be set at US$65 to US$70 per barrel.
The price cap is due to enter into force on Dec 5, 2022.
Zelensky said, “The limit that is being considered today – about US$60 – I think this is an artificial limit.” The Ukraine president has consistently pushed allies to impose tougher sanctions of all types against Russia.
Also Read: A $65-$70 Oil Price Cap May Not Hurt Putin
“We would like the sanctions to be very effective in this fight, so that the limit is at the level of US$30-US$40, so Russia feels them (the sanctions),” he told a news conference.
The idea of the cap is to prohibit shipping, insurance and re-insurance companies from handling cargoes of Russian crude around the globe, unless it is sold for less than the price set by the G-7 and its allies.
Poland, Estonia and Lithuania are pushing for a much lower cap than US$65-70 a barrel while Greece, Cyprus and Malta want a higher cap.