Russia mulling 3 possible responses to oil price cap measures

ISTANBUL

Over the past two weeks, Russian authorities have been considering three possible responses to a recent EU and G-7 price cap for oil imports from the country, local media reported on Wednesday

"The first option is a complete ban on the sale of oil to states that supported the restriction, including if they purchase raw materials from Russia not directly, but through intermediary countries or even their chain," two sources from the Russian Cabinet told the Russian daily Vedomosti.

The second option reportedly on the table is a ban on exports under contracts that include the price ceiling, regardless of the recipient country.

Moscow is also discussing the possibility of an "indicative price" measure as a third option determining the "maximum discount of Russian oil from the Urals to the benchmark Brent grade," prohibiting sales that go under the maximum discount level, according to the report.

The sources indicated that none of the options have yet been approved, with other alternatives and combinations still under consideration.

Deputy Prime Minister Aleksandr Novak said on Tuesday that they plan to ban oil sales to companies at a ceiling price until the end of the year,

"We are currently conducting consultations, finalizing the decision and discussing with companies," Novak said.

EU countries finalized work on an oil price cap for Russian seaborne crude on Saturday, which was immediately put into effect by a European Council decision.

"The G7 and all EU Member States have taken a decision that will hit Russia's revenues even harder and reduce its ability to wage war in Ukraine. It will also help us to stabilize global energy prices, benefitting countries across the world who are currently confronted with high oil prices," European Commission President Ursula von der Leyen said.

Kremlin spokesman Dmitry Peskov said on Monday that Russia was preparing a response.

Separately, an EU embargo on imports of Russian crude oil by sea, which was adopted by the EU Commission on June 3 as part of the sixth package of restrictive measures against Moscow, came into effect on Monday.

Russian officials had previously announced that they would refuse to sell oil to countries that agree to the price cap.