Sweden, Denmark, Finland, Latvia, Lithuania, and Estonia have urged the European Commission to further lower the $60 per barrel price cap on Russian oil set by the G7, Reuters reported on 13 January.
The countries argue that a lower cap would further restrict Russia’s ability to finance its war against Ukraine and prevent significant disruptions to global oil markets. Under current conditions, Western companies can only insure and transport Russian oil if it is sold below the cap. In a letter to the European Commission, the six countries reportedly emphasized the need to “further increase the impact of our sanctions by lowering the G7 oil price cap.”
The G7 initially introduced the cap to reduce Moscow’s oil revenues while maintaining stability in global markets. With forecasts of a global oil surplus in 2025 and softening prices, the G7 may consider more stringent measures.
Sanctions and Ukrainian drone strikes have already disrupted Russia’s oil production, with refineries in Tuapse, Ilyich, and Novoshakhtinsk reducing or halting operations, Reuters reported. These pressures have further strained the capacity of Russia’s energy sector, forcing it to sell oil at a discount and operate under high interest rates.
