'Shadow Fleet' Won't Help: EU Prepares New Blow to Russia's Oil Revenues.

The EU Proposes to Lower the Price of Russian Oil to $50 per Barrel

The European Union plans to appeal to the Group of Seven (G7) countries with a proposal to lower the maximum price of Russian oil to $50 per barrel, reports Reuters, citing its own sources. This initiative has been confirmed by European Commissioner for Economy Valdis Dombrovskis.

The price cap mechanism was introduced at the end of 2022 at a level of $60 per barrel. Under this mechanism, Western companies are allowed to purchase Russian oil only if it is sold at a price lower than the established limit. The U.S. and the European Union also imposed an embargo on most imports following Russia's invasion of Ukraine.

'Despite the initial agreement to review the restrictions monthly to ensure it is 5% lower than the average market price, such a review has not occurred even once. Russia has found ways to circumvent these restrictions, using the 'shadow fleet' of tankers to supply oil to new markets, primarily in Asia,' Dombrovskis noted.

From the very beginning, Ukraine has demanded a price cap on Russian oil at a level significantly lower than $30 per barrel.