Russian authorities rejects $60-a-barrel price cap on its oil
Kyiv: Russian authorities rejected a price cap on the country's oil set by Ukraine's Western supporters and threatened on Saturday to stop supplying the nations that endorsed it.
Australia, Britain, Canada, Japan, the United States and the 27-nation European Union agreed on Friday to cap what they would pay for Russian oil at USD 60-per-barrel. The limit is set to take effect on Monday, along with an EU embargo on Russian oil shipped by sea.
Kremlin spokesman Dmitry Peskov said Russia needed to analyze the situation before deciding on a specific response but that it would not accept the price ceiling. Russia's permanent representative to international organisations in Vienna, Mikhail Ulyanov, warned that the cap's European backers would come to rue their decision.
"From this year, Europe will live without Russian oil," Ulyanov tweeted.
"Moscow has already made it clear that it will not supply oil to those countries that support anti-market price caps. Wait, very soon the EU will accuse Russia of using oil as a weapon."
The office of Ukrainian President Volodymyr Zelenskyy, meanwhile, called on Saturday for a lower price cap, saying the one adopted by the EU and the Group of Seven leading economies didn't go far enough.
"It would be necessary to lower it to USD 30 in order to destroy the enemy's economy faster," Andriy Yermak, the head of Zelenskyy's office, wrote on Telegram, staking out a
position also favored by Poland a leading critic of Russian President Vladimir Putin's war in Ukraine.
Under Friday's agreements, insurance companies and other firms needed to ship oil would only be able to deal with Russian crude if the oil is priced at or below the cap. Most insurers are located in the EU and the United Kingdom and could be required to observe the ceiling.
Russia's crude has already been selling for around USD 60 a barrel, a deep discount from international benchmark Brent, which closed Friday at USD 85.42 per barrel.
The Russian Embassy in Washington insisted that Russian oil "will continue to be in demand" and criticized the price limit as "reshaping the basic principles of the functioning of free markets."
