World

EU Talks Over Russian Oil Price Cap Drag On


BRUSSELS — European Union ambassadors trying to reach an agreement on the highest price for Russian oil resumed talks on Thursday night, despite expectations that a deal would be within reach. hand.

Negotiations on capping the price of Russian oil, a policy led by the Group of Seven industrialized nations and other close allies of Ukraine, have been going on for more than a week at the headquarters of the European Union. .

Negotiators from the 27 EU member states need to agree on a price. The latest discussions revolve around a price of $60 a barrel, several diplomats and officials said. That’s lower than what the G7 originally proposed, a win for hardline pro-Ukrainian states like Poland that want a lower price to limit Russia’s oil revenue.

An almost complete embargo on Russian oil took effect on December 5 in the European Union. EU insurers and tankers – which make up half of the global fleet – will no longer be allowed to provide their services to transport Russian oil. It will not apply to Russian oil buyers, such as China and India, if they ship and insure the goods with companies from countries outside the group that imposed the cap.

Fearing a global oil crisis, the United States supports a policy of price caps, which will allow European oil tankers and insurers to continue to facilitate Russian oil exports. as long as the oil they are shipping or insured is sold at or below the limit price.

The benefit of this approach, according to promoters, is that Russia loses some revenue because the ceiling is set below the price of its oil normally sold in the market, but it has an incentive to continue selling crude. because the price is still high enough. to generate essential income. A ceiling would also prevent Russian oil prices from rising above a certain point if global prices rise.

Russian oil, also known as Urals crude, has fluctuated between $60 and $65 a barrel over the past week, trading at a substantial discount to other oils.

Poland and several allies have been the final holders in the EU negotiations. They are pushing for the lowest prices possible to limit oil revenues that help fund the war in Ukraine, as well as regularly modifying prices and more sanctions on Russia.

By Thursday evening, those points appeared to have been secured and EU diplomats entered what they hoped would be the last round of talks before signing an agreement. But Poland has asked for an extension, several EU diplomats and officials said.

Wally Adeyemo, the US Deputy Secretary of the Treasury, said on Thursday that he was encouraged by signs that the European Union was unifying around a price. “My view is that we will get this deal done,” Adeyemo said at an event sponsored by Reuters, adding that he was optimistic that Poland would support an agreement that its allies would agree to. Their remaining proof will then ratify.

Polish diplomats expressed optimism that an agreement could be reached, while others complained that the process had taken too long and risked making Ukraine’s European allies seem divided.

Alan Rappeport contribution report.

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