Nordics and Baltics ask EU to tighten price cap on Russian oil
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Denmark, Estonia, Finland, Latvia, Lithuania, and Sweden have called for a revision of the price cap on Russian seaborne oil, originally set at $60 per barrel in late 2022 and unchanged since then. In a joint letter to the European Commission, the Nordic and Baltic nations urged an immediate tightening of the cap, emphasising the need to continually strengthen sanctions to undermine the Kremlin’s ability to sustain its war in Ukraine.
“Targeting revenues from oil exports is essential as it strikes at Russia’s primary source of income,” the foreign ministers of the six countries stated in the letter. The ministers argued that the current moment presents an opportunity to maximise the effectiveness of sanctions by lowering the G7-imposed oil price cap.
The price cap, introduced by G7 allies in late 2022, is a landmark measure designed to restrict the seaborne trade of Russian crude oil at $60 per barrel. Under this mechanism, Western companies are barred from providing services such as insurance, financing, and flagging to Russian tankers selling crude above the set price.
Additionally, the G7 implemented two supplementary caps: $100 per barrel for premium-to-crude products and $45 per barrel for discount-to-crude products.
Since their adoption, the caps have remained unchanged, despite significant fluctuations in Russian trade and clear evidence of sanctions evasion.
