Zelensky's chief of staff: Price cap on Russian oil should be lowered to $30 a barrel

The senior Ukrainian presidential aide said lowering the price cap is necessary to 'destroy the enemy's economy quicker'

Published : 3 Dec 2022, 08:33 AM
Updated : 3 Dec 2022, 08:33 AM

The price cap on Russian seaborne crude oil agreed to by the Group of Seven nations and Australia on Friday should be lowered to $30 per barrel to hit Russia's economy harder, a senior Ukrainian presidential aide said on Saturday.

"This was everything that was proposed by the McFaul-Yermak group, but it would be necessary to lower it to $30 to destroy the enemy's economy quicker," Andriy Yermak, head of Ukraine's presidential administration, wrote on Telegram referencing an international working group on sanctions.

The G7 and Australia have agreed a $60 per barrel price cap.

The group and Australia said in a statement the price cap would take effect on Dec. 5 or very soon thereafter.

The nations said they anticipated that any revision of the price would include a form of grandfathering to allow compliant transactions concluded before the change.

The price cap will allow non-EU countries to continue importing seaborne Russian crude oil, but it will 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 cap.

Because the most important shipping and insurance firms are based in G7 countries, the price cap would make it very difficult for Moscow to sell its oil for a higher price.

Toufique Imrose Khalidi
Editor-in-Chief and Publisher