In coordination with the G7, the twenty-seven set up a second salvo of sanctions targeting Russian oil. After crude in December 2022, refined products in Russia are prohibited from February 5, and a maximum price is imposed on the market.
by Marjorie Cessac and Philippe Jacqué (Brussels, Bureau European)
The first Russian oil embargo did not cause upheaval on the world market. What will be of the second?
After having ceased to import Russian crude oil in early December 2022, the European Union (EU), in connection with the G7 countries and Australia, is preparing this Sunday, February 5, to launch the second Shutter of his plan, by prohibiting the import of refined Russian petroleum products, mainly diesel but also kerosene, fuel oil or fuel oil.
This measure is particularly sensitive, as the old continent is dependent on Russia for these products, and more precisely diesel. Despite the sharp drop in imports for a year, Russian diesel still represents a quarter of the imports of this fuel in Europe. Every day, the EU consumes some 6.4 million barrels of diesel, while its refineries produce only 5 million … The balance is allowed thanks to imports, of which around 700,000 barrels come from Russia. The rest of the needs is covered by the Gulf States, the United States and India.
In parallel with the embargo, the twenty-seven decided to set a ceiling price for these Russian products, as they had already done, up to 60 dollars (around 56 euros) per barrel, for oil Russian gross. For “premium” fuels (diesel, kerosene, etc.), the price will not exceed 100 dollars per barrel. For simpler products, such as fuel oil, the limit will be $ 45, “in order to weigh on Russia’s income, while maintaining a fluid global market for these products,” said a European diplomat. Concretely, Western countries prohibit service providers (transport, insurance, etc.) to transport these Russian products beyond the fixed price.
stocks and new sources
If the mechanism has been tested for two months for crude, the EU member states have nevertheless taken the time to agree, Friday, February 3. Baltic and Poland countries were militating to lower the crude and refined products more to further reduce Russian revenues, says a diplomat from northern Europe. But now, the rest of the States, in the EU or in the G7, did not intend to destabilize the market.
“In mid-March, specifies a source, after a global analysis of the mechanism in place, a decision will be made to know whether to modify the level of ceiling price.” According to Russia, on the other hand, this decision “will further unbalance the international energy markets,” the spokesperson for the Russian presidency, Dmitri Peskov, said on Friday, assuring that Moscow “took measures to cover [his] interests”.
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