Nov 24, 2022 14:52 UTC
  • EU members fail to agree on price cap for Russian oil

Member states of the European Union have failed to reach an agreement on a proposed price cap for Russian sea-borne oil, planning to keep negotiating about the matter.

Representatives of the bloc's 27 governments failed to agree on a Group of Seven (G7) proposal to set the price ceiling in the range of $65-$70 per barrel during talks in the Belgian capital of Brussels on Wednesday.

They announced plans to continue talks on Thursday.

"There are still differences on the price cap level. We need to proceed bilaterally," Reuters quoted an unnamed diplomat as saying on Wednesday. "The next meeting of ambassadors of EU countries will be either tomorrow evening or on Friday," the diplomat added.

The European Commission proposed that the ceiling be set at $65 per barrel. However, Poland, Lithuania, and Estonia opposed the proposal, saying such a price would be too "generous" and would leave Moscow with too high a profit as production costs are about $20 per barrel.

On the other hand, some other countries with major shipping industries like Greece and Malta argue that the cap was better to be set at around $70.

"We're looking for ways how this can work and how one can find a common basis so that this can be implemented in an ideally pragmatic and efficient way while at the same time avoiding that this could lead to excessive disadvantages for the countries of the European Union," German Chancellor Olaf Scholz said on Wednesday.

"But for my part, I want to say that I'm pretty confident that we’ll get this done soon," he stressed.

The G7, including the United States, as well as the whole of the EU plus Australia, intend to impose a punitive price cap on sea-borne exports of Russian oil on December 5, as part of sanctions against Moscow over its military operation in Ukraine that began on February 24.