Bloomberg: The European Union cannot agree on a reduction in Russian oil prices. Reasons

European Union countries cannot agree on lowering the price ceiling for Russian oil from $60 to $45 per barrel. Some states are against such a decision.

Bloomberg writes about this with reference to diplomatic sources and does not specify who exactly is hindering the decision to lower Russian oil prices.

Last week, the European Commission proposed including a clause in a new package of sanctions against Russia to lower the G7 price ceiling on Russian oil. Some EU countries that support the cap are concerned that the initiative may not receive unanimous support without US consent, diplomats familiar with the situation say.

During a meeting of ambassadors in Brussels on Monday, June 16, several EU members cast doubt on the price cut. Diplomats said that the recent rise in oil prices due to tensions between Iran and Israel was an additional complication. This would make it difficult for the EU to make a decision without the participation of the United States. In addition, the marketʼs biggest fear is that Iran could block the Strait of Hormuz, a vital route for transporting oil. This could cause a new surge in prices.

In addition, some countries have raised the issue of the need for coordination with the G7, indicating an unwillingness to act without the US. Earlier, Reuters wrote that most G7 countries are ready to lower the ceiling on Russian oil without US participation.

As Bloomberg previously reported, the United States said before the G7 summit in Canada that it did not support lowering the price that could be set for Russian oil. This has reduced Europeʼs hopes that G7 leaders will agree to a change. The final decision rests with US President Donald Trump, and some officials are hopeful that his agreement will be reached, sources said.

• After several weeks of Russian oil prices being below $60 a barrel, it rose back above that mark last week, according to Argus Media, an independent energy and commodities market intelligence provider. In theory, Western companies are prohibited from selling Russian oil unless they have documentation proving that it is priced at $60 or less per barrel.
• In 2022, the G7, as well as Australia and the EU, imposed price caps on Russian oil, setting a maximum price of $60 per barrel. Russia has begun building a shadow fleet to circumvent these caps. It is regularly subject to sanctions.
• Ukraine is now proposing to halve the price of Russian oil. Ukrainian politicians, including Volodymyr Zelensky, are calling for tougher sanctions against Russiaʼs energy sector. The European Union is working on an 18th package of sanctions.

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