The Russian government has established a procedure by which it will implement the decree of the President of the Russian Federation on the ban on oil supplies under contracts that set a ceiling on fuel prices. A statement with clarifications on Monday, January 30, was signed by Russian Prime Minister Mikhail Mishustin.
The document requires the Ministry of Energy and the Ministry of Finance to develop and approve the procedure for monitoring export prices for oil from Russia by March 1. At the request of the authorities, exporting companies will be required to provide them with information on contracts, prices, as well as monitoring data confirming the fact that the oil price ceiling mechanism has not been used every month.
Earlier, on January 27, Russian President Vladimir Putin instructed the government to develop a methodology for calculating prices for oil and oil products for tax purposes. The Russian leader emphasized the importance of reducing the negative sanctions restrictions on the formation of indicative oil prices and subsequent payments to the federal budget of the Russian Federation.
The day before, information appeared that the EU countries are considering the possibility of introducing a ceiling on prices for diesel fuel and fuel oil from Russia. Diesel will be capped at $100 per barrel and fuel oil at $45 per barrel, Bloomberg sources said. It is also noted that some countries advocated a more serious price cap.
On January 23, the newspaper Kommersant reported that the Russian government would instruct Russian oil companies to ensure that in the event of further resale of oil, a price ceiling was not applied to it.
Prior to that, on December 27, Vladimir Putin signed a decree on retaliatory measures, according to which the supply of oil and oil products to foreign legal entities and individuals is prohibited, provided that the contracts for these supplies directly or indirectly provide for the use of a price cap mechanism.
Since December 5, there has been an embargo on oil supplied by sea from Russia to the EU. The EU countries have set an adjustable ceiling on the cost of seaborne oil from Russia at $60 per barrel. It is assumed that from February 5, the European embargo on the import of Russian oil products delivered by sea will come into effect.