© Reuters. FILE PHOTO: An aerial view shows the Vladimir Arsenyev tanker at the Kozmino oil terminal on the shores of Nakhodka Bay near the port of Nakhodka, Russia August 12, 2022. REUTERS/Tatiana Meel/File Photo
By Jan Strupczewski, Kate Abnett, David Lawder and Andrea Shalal
WASHINGTON/BRUSSELS (Reuters) – The Group of Seven (G7) and Australia said on Friday they had agreed to reduce the price of $60 per barrel in Russian oil after the European Union members overcame Poland’s resistance and established a political agreement earlier. .
The EU agreed to the price after Poland did not offer aid, opening the way for approval at the end of the week.
G7 and Australia said that the tariff will come into effect on Dec. 5 or later.
States said they hoped that any revisions to the price would include the type of grandchildren to allow for approvals that were completed before the event.
“The Price Cap Coalition may consider other actions to ensure that the price cap remains stable,” the statement read. No information was immediately available on what would happen.
The tariff, a proposal of the G7, aims to reduce Russia’s income from the sale of oil, and prevent the increase in oil prices worldwide after the EU ban on Russian food from 5 December.
Warsaw rejected the proposed rate as it considered a way to adjust the rate to below market value. He pushed in the EU negotiations to keep the tariff too low to squeeze money from Russia and limit Moscow’s ability to support its war in Ukraine.
Poland’s ambassador to the EU Andrzej Sados on Friday told reporters that Poland supported the EU agreement, which includes a mechanism to keep the price of oil at least 5% below the market. US officials say the agreement is unprecedented and shows the determination of the alliance against Russian aggression.
A spokesman for the Czech Republic, which holds the rotating presidency of the EU and oversees negotiations between EU countries, said it had set up a process to write to all 27 EU countries to ensure the deal, following Poland’s approval.
Details of the agreement are due to be published in the EU’s official gazette on Sunday.
EU SEES LARGE USE OF RUSSIAN MONEY
European Commission President Ursula von der Leyen said the tariff would significantly reduce Russian spending.
“It will help stabilize global energy prices, benefiting emerging economies around the world,” von der Leyen said on Twitter, adding that the cap “can be adjusted over time” to respond to market growth.
The G7 tariff will allow non-EU countries to continue to import Russian crude oil, but will prevent shipping, insurance and insurance companies from taking Russian products to the world, unless they are sold at a lower price. .
Because the most important shipping and insurance companies are located in the G7 countries, the high price would make it more difficult for Moscow to sell its oil at a higher price.
US Treasury Secretary Janet Yellen said the cap would benefit low- and middle-income countries that have been experiencing high energy and food prices.
“With Russia’s economy already functioning and its budget expanding, inflation will immediately cut into Putin’s most important source of income,” Yellen said in a statement.
The head of the US Treasury Department told reporters on Friday that the price of $ 60 per barrel for Russian crude oil will make the international market better supplied while “stabilizing” the discount created due to the threat of borders.
The chairman of Russia’s foreign affairs committee told the Tass news agency on Friday that the European Union is risking its security.
The first G7 proposal last week was for a price of $65-$70 per barrel with no change option. Since the Russian Urals had already sold lower, Poland, Lithuania and Estonia pushed for a lower price.
Russia’s Urals traded at around $67 a barrel on Friday.
EU countries have been debating for days on the details, the countries adding to the terms of the agreement – including that the price will be reviewed in January and every two months thereafter, according to diplomats and an EU document seen by Reuters on Thursday. .
The document also said the 45-day transition period will apply to Russian oil tankers loaded before December 5 and unloaded by January 19, 2023.