Bloomberg reported on May 31 that the EU might temporarily forgo raising the price cap on Russian oil. The current cap is set at $44.1 per barrel and is supposed to be reviewed biannually based on the average Urals price. Due to the surge in global prices stemming from the Middle Eastern conflict, the cap could potentially rise to $65 per barrel, according to the agency.
According to Bloomberg, the EU may suspend the automatic increase of the price cap until the end of 2026 or set it at a maximum of $60 per barrel.
This measure may be included in the 21st sanctions package from the EU against Russia. A representative of the European Commission declined to comment to the agency.
The EU and G7 countries allow their companies to provide services for maritime transportation of Russian oil and oil products to third countries while adhering to the price cap. The $44.1 per barrel cap has been established by the authorities of the EU, the UK, and Canada, while Japan has set its cap at $47.6 per barrel and the USA at $60 per barrel.
According to S&P Global Commodities at Sea (CAS) and Maritime Intelligence Risk Suite, tankers associated with G7 countries or their allies provided 29.4% of Russian oil exports amounting to 4.1 million barrels per day (b/d) in April, up from 20.3% in March. This April figure marks the highest in seven months.
The increase in the share of G7-associated tankers has been attributed by analysts to signals from Western authorities regarding a potential easing of sanctions on Russian oil due to an impending shortage of crude on the global market due to the Middle Eastern conflict. The USA has issued four licenses for transactions involving Russian oil and oil products since March, with the latest permit valid until June 17 and covering volumes loaded onto tankers by April 17.
Furthermore, the EU did not include a ban on providing services for the transportation of Russian oil in its 20th sanctions package. Instead, the EU Council reported that a "basis for a future ban" would be established in coordination with the G7. The council’s regulation noted that amending the price cap on Russian oil and oil products is advisable to allow for the "swift blocking" of maritime shipments (see “Kommersant” April 24).
According to Bloomberg, a complete ban on maritime transportation of Russian oil is also unlikely to be included in the 21st sanctions package from the EU against Russia.
This measure does not have the support of several EU member states and the G7 countries as a whole, the agency notes. Previously, Greece, the largest ship-owning nation in Europe, opposed a complete ban. According to CAS, Greek tanker operators increased the transportation of Russian oil by 2.2 times in April, reaching 687,000 b/d, the highest level since October 2025.
Financial University expert Igor Yushkov states that the price cap itself does not affect the volumes of Russian exports. However, if the cap is raised and Russian oil falls within its limits, it would heighten competition between shadow and conventional fleets, lower freight costs, and enable Russia to earn more—this is essentially the challenge for Europeans prompting them to contemplate their next steps.
Kirill Bakhtin, head of the analytical center for Russian equities “BCS World of Investments,” points out that the level of $44.1 or $60–65 per barrel is not particularly critical for Russian oil producers since the actual price is higher. As of May 22, according to Argus, Urals was priced at $84–85 per barrel depending on the loading port. "We believe the EU price cap is far less effective compared to the G7 cap," adds Mr. Bakhtin.
According to Sergei Teryoshkin, general director of Open Oil Market, the price cap on oil is the most challenging restrictive measure to administer.
"If monitoring the direct import of oil and oil products requires overseeing incoming vessels at ports, monitoring the price cap necessitates tracking hundreds and thousands of oil purchase transactions, which is practically impossible from a technical standpoint," explains the analyst. However, Mr. Teryoshkin notes that a temporary waiver of the price cap would imply an acknowledgment of this measure’s ineffectiveness, prompting the EU to consider another "reconfiguration" of this mechanism. In terms of the overall market situation, he believes little would change.
Source: Kommersant
